Registration No. 2-82590
File No. 811-3694
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
PRE-EFFECTIVE AMENDMENT NO. ______ / /
POST-EFFECTIVE AMENDMENT NO. 20 / X /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / X /
AMENDMENT No. 20 / X /
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
(Exact Name of Registrant as Specified in Charter)
Two World Trade Center, New York, New York 10048-0203
(Address of Principal Offices)
1-212-323-0200
(Registrant's Telephone Number)
ANDREW J. DONOHUE, ESQ.
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
/ / Immediately upon filing pursuant to paragraph (b)
/ / On pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a)
/ X / On November 1, 1994 pursuant to paragraph (a)
of Rule 485
Registrant has registered an indefinite number of shares under the
Securities Act of 1933 pursuant to Rule 24f-2 promulgated under the
Investment Company Act of 1940. A Rule 24f-2 Notice for the Registrant's
fiscal year ended June 30, 1994, was filed on August 30, 1994.
<PAGE>
FORM N-1A
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
Cross Reference Sheet
Part A of
Form N-1A
Item No. Prospectus Heading
1 Front Cover Page
2 Expenses
3 Financial Highlights; Performance of the Fund
4 Front Cover Page; Investment Objectives and Policies
5 How the Fund is Managed; Expenses; Back Cover
5A Performance of the Fund
6 Dividends, Capital Gains and Taxes
7 How to Buy Shares; How to Exchange Shares; Special Investor
Services; Service Plan; How to Sell Shares
8 How to Sell Shares
9 *
Part B of
Form N-1A Heading in Statement of
Item No. Additional Information
10 Cover Page
11 Cover Page
12 *
13 Investment Objective and Policies; Other Investment Techniques
and Strategies; Additional Investment Restrictions
14 How the Fund is Managed - Trustees and Officers of the Fund;
15 How the Fund is Managed - Major Shareholders
16 How the Fund is Managed; Service Plan
17 Brokerage Policies of the Fund
18 Additional Information - About the Fund
19 Your Investment Account-How to Buy Shares; How to Sell Shares;
How to Exchange Shares
20 Dividends, Capital Gains and Taxes
21 How the Fund is Managed; Brokerage Policies of the Fund
22 Performance of the Fund
23 *
______________________________________
* Not applicable or negative answer.
<PAGE>
Oppenheimer Gold & Special Minerals Fund
Prospectus dated November 1, 1994
Oppenheimer Gold & Special Minerals Fund (the "Fund") is a mutual
fund that seeks capital appreciation as its investment objective. The
Fund does not invest to earn current income to distribute to shareholders.
In seeking its objective, the Fund invests mainly in securities of
companies engaged in mining, processing, fabricating or distributing gold
or other metals or minerals in the United States and in foreign countries.
Normally at least 50% of the Fund's investments are expected to be in
foreign securities. The Fund may also invest to a limited extent in gold
or silver bullion, other precious metals, strategic metals, and other
metals naturally occurring with such metals, and gold or silver coins.
The Fund also uses "hedging" instruments, to seek to reduce the risks of
market fluctuations that affect the value of the securities the Fund
holds.
Some investment techniques the Fund uses may be considered to be
speculative investment methods that may increase the risks of investing
in the Fund and may also increase the Fund's operating costs. You should
carefully review the risks associated with an investment in the Fund.
Please refer to "Investment Policies and Strategies" for more information
about the types of securities the Fund invests in and the risks of
investing in the Fund.
This Prospectus explains concisely what you should know before
investing in the Fund. Please read this Prospectus carefully and keep it
for future reference. You can find more detailed information about the
Fund in the November 1, 1994, Statement of Additional Information. For a
free copy, call Oppenheimer Shareholder Services, the Fund's Transfer
Agent, at 1-800-525-7048, or write to the Transfer Agent at the address
on the back cover. The Statement of Additional Information has been filed
with the Securities and Exchange Commission and is incorporated into this
Prospectus by reference (which means that it is legally part of this
Prospectus).
Because of the Fund's investment policies and practices, the Fund's shares
may be considered to be speculative.
Shares of the Fund are not deposits or obligations of any bank, are not
guaranteed by any bank, are not insured by the F.D.I.C. or any other
agency, and involve investment risks, including the possible loss of
principal.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
Contents
Page
ABOUT THE FUND
Expenses
Financial Highlights
Investment Objective and Policies
How the Fund is Managed
Performance of the Fund
ABOUT YOUR ACCOUNT
How to Buy Shares
Special Investor Services
AccountLink
Automatic Withdrawal and Exchange
Plans
Reinvestment Privilege
Retirement Plans
How to Sell Shares
By Mail
By Telephone
How to Exchange Shares
Shareholder Account Rules and Policies
Dividends, Capital Gains and Taxes
<PAGE>
ABOUT THE FUND
Expenses
The Fund pays a variety of expenses directly for management of its
assets, administration, distribution of its shares and other services, and
those expenses are reflected in the Fund's net asset value per share. As
a shareholder, you pay those expenses indirectly. Shareholders pay other
expenses directly, such as sales charges. The following tables are
provided to help you understand your direct expenses of investing in the
Fund and your share of the Fund's operating expenses that you will bear
indirectly. The numbers below are based on the Fund's expenses during its
fiscal year ended June 30, 1994.
- Shareholder Transaction Expenses are charges you pay when you buy
or sell shares of the Fund. Please refer to pages _____ through _____ for
an explanation of how and when these charges apply.
Maximum Sales Charge on Purchases
(as a % of offering price) 5.75%
Sales Charge on Reinvested Dividends None
Deferred Sales Charge
(as a % of the lower of the original
purchase price or redemption proceeds None(1)
Exchange Fee $5.00(2)
(1) If you invest more than $1 million in shares of the Fund, you may
have to pay a sales charge of up to 1% if you sell your shares within
18 calendar months from the end of the calendar month during which
you purchased those shares. See "How to Buy Shares," below.
(2) Fee is waived for automated exchanges on PhoneLink, described in "How
to Buy Shares."
- Annual Fund Operating Expenses are paid out of the Fund's assets
and represent the Fund's expenses in operating its business. For example,
the Fund pays management fees to its investment adviser, Oppenheimer
Management Corporation (the "Manager"), and other regular expenses for
services, such as transfer agent fees, custodial fees paid to the bank
that holds its portfolio securities, audit fees and legal and other
expenses.
The following numbers are projections of the Fund's business expenses
based on the Fund's expenses in its last fiscal year. These amounts are
shown as a percentage of the average net assets of the Fund for that year.
The management fee and 12b-1 Plan fee data has been restated, however,
because of changes to those fee rates that took effect after the close of
the fiscal year. The management fee rates were reduced, effective July
1, 1994, to 0.75% of the first $200 million of the Fund's aggregate net
assets (from 0.80%) and 0.72% (from 0.75%) on the next $200 million.
During the fiscal year, the management fee was actually ___% of the Fund's
average net assets.
The "12b-1 Plan Fees" are the Service Plan Fees (which are a maximum
of 0.25% of average annual net assets). Because the Fund's shareholders
approved a new 12b-1 Plan that applies to all shares of the Fund effective
July 1, 1994, the actual 12b-1 Plan fees for the Fund's fiscal year ended
June 30, 1994, are restated to show what those fees would have been if the
new Plan had been in effect during the previous fiscal year. During the
fiscal year, the actual rate was ___%, and actual total operating expenses
were ___% of average annual net assets. The actual expenses of the Fund
in future years may be more or less, depending on a number of factors,
including changes in the actual value of the Fund's assets on which some
of these fees are based.
Management Fees (Restated) %
12b-1 (Service Plan) Fees (Restated) %
Other Expenses %
Total Fund Operating Expenses %
- Example. To try to show the effect of these expenses on an
investment over time, we have created the hypothetical example shown
below. Assume that you make a $1,000 investment in the Fund, and that the
Fund's annual return is 5%, and that its operating expenses are the ones
shown in the chart above (as restated). If you were to redeem your shares
at the end of each period shown below, your investment would incur the
following expenses by the end of each period shown:
1 year 3 years 5 years 10 years
$ $ $ $
This example shows the effect of expenses on an investment, but is not
meant to state or predict actual or expected costs or investment returns
of the Fund, all of which will vary.
<PAGE>
Financial Highlights
The table on this page presents selected financial information about the
Fund, including per share data and expense ratios and other data based on
the Fund's average net assets. This information has been audited by KPMG
Peat Marwick LLP, the Fund's independent auditors, whose report on the
Fund's financial statements for the fiscal year ended June 30, 1994, is
included in the Statement of Additional Information.
<PAGE>
Investment Objective and Policies
Objective. The Fund invests its assets to seek long-term capital
appreciation for shareholders. The Fund does not invest to seek current
income to pay to shareholders.
Investment Policies and Strategies. The Fund seeks its investment
objective by emphasizing investments in securities of companies involved
directly or indirectly in mining, fabricating, processing or otherwise
dealing in gold or other metals or minerals. The Manager expects that
ordinarily a substantial portion of the Fund's assets will be invested in
securities of gold mining companies. This Prospectus refers to those
securities as "Mining Securities."
The Fund will normally invest in common stocks or other equity
securities, as well as securities that are convertible into common stocks,
such as convertible preferred stock, convertible debentures, and warrants.
These securities may be traded on securities exchanges or in the over-the-
counter markets. The Fund may also invest in gold or silver bullion, in
other precious metals, strategic metals, and other metals naturally
occurring with precious or strategic metals, in certificates representing
an ownership interest in those metals, and in gold or silver coins. These
investments are referred to as "Metal Investments." While the Fund may
hold gold or silver coins that have an active, quoted trading market, it
will not hold them for value as "collectibles."
To seek the Fund's objective, the Fund's investment adviser, Oppenheimer
Management Corporation (the "Manager"), looks for Mining Securities and
Metal Investments that it believes may appreciate in value, by
continuously monitoring the gold and special minerals markets for new
developments and economic trends.
When investing the Fund's assets, the Manager considers many factors,
including general economic conditions in the U.S. relative to foreign
economies, and the trends in domestic and foreign stock markets. The Fund
may try to hedge against losses in the value of its portfolio of
securities by using the hedging strategies described below. When market
conditions are unstable, or there are adverse economic political or market
conditions affecting Mining Securities and Metal Securities, the Fund may
invest substantial amounts of its assets in debt securities, such as money
market instruments or government securities, as described in "Temporary
Defensive Investments" below. The Fund's portfolio manager may employ
special investment techniques in selecting securities for the Fund. These
are also described below. Additional information may be found about them
under the same headings in the Statement of Additional Information.
- Can the Fund's Investment Objective and Policies Change? The Fund
has an investment objective, which is described above, as well as
investment policies it follows to try to achieve its objective.
Additionally, the Fund uses certain investment techniques and strategies
in carrying out those policies. The Fund's investment policies and
practices are not "fundamental" unless this Prospectus or the Statement
of Additional Information says that a particular policy is "fundamental."
Fundamental policies are those that cannot be changed without the
approval of a "majority" of the Fund's outstanding voting shares. The
term "majority" is defined in the Investment Company Act to be a
particular percentage of outstanding voting shares (and this term is
explained in the Statement of Additional Information). The Fund's
investment objective is a fundamental policy. The Fund's Board of Trustees
may change non-fundamental policies without shareholder approval, although
significant changes will be described in amendments to this Prospectus.
- The Fund "Concentrates" in Mining Securities and Metal Investments.
As a fundamental policy, the Fund will concentrate its investments in
Mining Securities and Metal Investments. Normally, at least 80% and up
to 100% of the Fund's assets will be invested in Mining Securities and
Metal Investments. Under the Investment Company Act of 1940 (the federal
law that principally regulates the operations of investment companies like
the Fund), "concentrating" investments means that a fund invests at least
25% of its assets in a particular industry or group of industries.
However, the Fund may not acquire additional Metal Investments if
acquiring them would result in more than 10% of the Fund's total assets
being invested in Metal Investments.
- Special Risks of Concentrating Investments in Mining Securities and
Metal Investments. Investments in Mining Securities and Metal Investments
are considered speculative and involve substantial risks and special
considerations. Investing in one segment of the stock market rather than
in a broad spectrum of types of companies makes the Fund's share price
particularly sensitive to market and economic events that affect the
mining and metal industries. These risks include: (i) the risk that
prices of gold and precious metals may fluctuate substantially; (ii) the
principal sources of the supply of gold are basically concentrated in only
five countries or territories (South Africa, Australia, Russia, Canada and
the United States); (iii) international monetary policies, economic and
political conditions, all of which affect the supply of gold and precious
metals as well as the value of Metal Securities and Mining Securities;
(iv) possible regulation of Metal Investments by U.S. or foreign
governments; and (v) possible adverse tax consequences for the Fund in
making Metal Investments, if holding those investments should cause it to
fail to qualify as a "regulated investment company" under the Internal
Revenue Code. The Statement of Additional Information contains more
details about those risks, which can affect the Fund's net asset value per
share and cause the value of an investment in the Fund to fluctuate.
- Other Investment Risks. Because of the types of securities the Fund
invests in and the investment techniques the Fund uses, some of which may
be speculative, it is designed for investors who are investing for the
long-term and who are willing to accept greater risks of loss of their
capital in the hope of achieving capital appreciation. It is not intended
for investors seeking assured income and conservation of capital.
Investing for capital appreciation entails the risk of loss of all or part
of your principal. Because there is no assurance that the Fund will
achieve its investment objective, when you redeem your shares, they may
be worth more or less than what you paid for them.
- Foreign Securities. Because over 90% of the world's gold production
is in foreign countries, it is anticipated that the Fund will normally
invest a substantial amount of its assets in securities of foreign
issuers. The Fund may purchase equity (and debt) securities issued or
guaranteed by foreign companies or foreign governments or their agencies.
The Fund may buy securities of companies in any country, developed or
underdeveloped. The Fund can invest up to 100% of its assets in foreign
securities.
When more than 50% of its assets are invested in foreign securities at
the end of any fiscal year, the Fund may elect that Section 853 of the
Internal Revenue Code will apply to it to permit shareholders to take a
credit (or a deduction) on their own federal income tax returns for
foreign taxes paid by the Fund. "Dividends, Capital Gains and Taxes" in
the Statement of Additional Information contains further information about
this tax provision.
The Fund will hold foreign currency only in connection with the purchase
or sale of foreign securities. If the Fund's securities are held abroad,
the countries in which they are held and the sub-custodians holding them
must be approved by the Fund's Board of Trustees.
Foreign securities have special risks. For example, foreign issuers are
not subject to the same accounting and disclosure requirements that U.S.
companies are subject to. The value of foreign investments may be affected
by changes in foreign currency rates, exchange control regulations,
expropriation or nationalization of a company's assets, foreign taxes,
delays in settlement of transactions, changes in governmental economic or
monetary policy in the U.S. or abroad, or other political and economic
factors. More information about the risks and potential rewards of
investing in foreign securities is contained in the Statement of
Additional Information.
- Warrants. Warrents basically are options to purchase stock at set
prices that are valid for a limited period of time. The Fund may invest
up to 5% of its total assets in warrants. That 5% excludes warrants the
Fund acquired in units or that were attached to other securities. No more
than 2% of the Fund's assets may be invested in warrants that are not
listed on the New York or American Stock Exchanges. For further details
about these investments, see "Warrants" in the Statement of Additional
Information.
- Special Risks - Borrowing for Leverage. The Fund may borrow money
from banks to buy securities. The Fund will borrow only if it can do so
without putting up assets of security of a loan. This is a speculative
investment method known as "leverage." This investing technique may
subject the Fund to greater risks and costs than funds that do not borrow.
These risks may include the possibility that the Fund's net asset value
per share will fluctuate more than funds that don't borrow, since the Fund
pays interest on borrowings and interest expense affects the Fund's share
price. Borrowing for leverage is subject to limits under the Investment
Company Act, described in more detail in the Statement of Additional
Information.
- Portfolio Turnover. A change in the securities held by the Fund is
known as "portfolio turnover." The Fund may engage frequently in short-
term trading to try to achieve its objective. As a result, the Fund's
portfolio turnover may be higher than other mutual funds, although it is
not expected to be more than 100% each year. The "Financial Highlights,"
above, show the Fund's portfolio turnover rate during past fiscal years.
High turnover and short-term trading may cause the Fund to have relatively
larger commission expenses and transaction costs than funds that do not
engage in short-term trading. Additionally, high portfolio turnover may
affect the ability of the Fund to qualify as a "regulated investment
company" under the Internal Revenue Code for tax deductions for dividends
and capital gains distributions to shareholders. The Fund qualified in
its last fiscal year and intends to do so in the coming year, although it
reserves the right not to qualify.
Other Investment Techniques and Strategies. The Fund may also use the
investment techniques and strategies described below, which involve
certain risks. The Statement of Additional Information contains more
information about these practices, including limitations on their use that
are intended to reduce some of the risks.
- Investing in Small, Unseasoned Companies. The Fund may invest in
securities of small, unseasoned companies. These are companies that have
been in operation for less than three years, even after including the
operations of any predecessors. Securities of these companies may have
limited liquidity (which means that the Fund may have difficulty selling
them at an acceptable price when it wants to) and the prices of these
securities may be volatile. The Fund currently intends to invest no more
than 5% of its net assets in securities of small, unseasoned issuers.
- Writing Covered Calls. The Fund may write (that is, sell) covered
call options (calls) to raise cash for liquidity purposes (for example,
to meet redemption requirements) or for defensive reasons. The Fund
receives cash (called a premium) when it writes a call. The call gives
the buyer the ability to buy the security from the Fund at the call price
during the period the call may be exercised. If the value of the security
does not rise above the call price, it is likely that the call will lapse
without being exercised, while the Fund keeps the cash premium (and the
security).
The Fund may write calls only if certain conditions are met: (1) after
writing any call, not more than 25% of the Fund's total assets may be
subject to calls; (2) the calls must be listed on a domestic securities
exchange or quoted on the Automated Quotation System of the National
Association of Securities Dealers, Inc. (NASDAQ); and (3) each call must
be "covered" while it is outstanding; that means the Fund must own the
securities on which the call is written or it must own other securities
that are acceptable for the escrow arrangements required for calls. The
Fund can also write covered calls on Futures Contracts it owns (these are
described in the next section), but these calls must be covered by
securities or other liquid segregated assets the Fund owns, so that it
will be able to satisfy its obligations if the call is exercised.
If a covered call written by the Fund is exercised on a security that
has increased in value, the Fund will be required to sell the security at
the call price and will not be able to realize any profit if the security
has increased in value above the call price. The Fund will not write (or
purchase) any call that will cause the value of the Fund's calls on a
particular security to exceed 3% of the Fund's total assets. That
restriction includes warrants on a security but not calls purchased in
closing transactions discussed in the next section.
- Hedging With Options and Futures Contracts. The Fund may buy and
sell options and futures contracts to try to manage its exposure to
declining prices on its portfolio securities or to establish a position
in the equity securities market as a temporary substitute for purchasing
individual securities. Some of these strategies, such as selling futures,
buying puts and writing covered calls, hedge the Fund's portfolio against
price fluctuations. Other hedging strategies, such as buying futures and
buying call options, tend to increase the Fund's exposure to the market.
The Fund may buy and sell futures contracts only if they relate to
broadly-based stock indices (these are referred to as "Stock Index
Futures"), as described in the Statement of Additional Information. The
Fund may also purchase certain kinds of put and call options, Stock Index
Futures and options on Stock Index Futures and on broadly-based stock
indices. These are all referred to as "hedging instruments." The Fund
does not use hedging instruments for speculative purposes. The hedging
instruments the Fund may use are described below and in greater detail in
"Other Investment Techniques and Strategies" in the Statement of
Additional Information.
The Fund may purchase put options ("puts"). Buying a put on an
investment gives the Fund the right to sell the investment to a seller of
a put on that investment at a set price. The Fund can buy only puts that
relate to (1) securities or Stock Index Futures, or (2) broadly-based
stock indices. The Fund can buy a put on a Stock Index Future whether or
not the Fund owns the particular Stock Index Future in its portfolio. The
Fund may not sell puts other than a put that it previously purchased. The
Fund may purchase calls only on securities, broadly-based stock indices
or Stock Index Futures, or to terminate its obligation on a call the Fund
previously wrote. A call or put may not be purchased if as a result of
that purchase the value of all of the Fund's put and call options would
exceed 10% of the Fund's total assets.
Hedging instruments can be volatile investments and involve special
risks. The use of hedging instruments requires special skills and
knowledge of techniques that are different than what is required for
normal portfolio management. If the Manager uses a hedging instrument at
the wrong time or judges market conditions incorrectly, hedging strategies
may reduce the Fund's return. The Fund could also experience losses if the
prices of its futures and options positions were not correlated with its
other investments or if it could not close out a position because the
market for the future or option were illiquid.
Options trading involves the payment of premiums and has special tax
effects on the Fund. There are also special risks in particular hedging
strategies. For example, in writing puts, there is a risk that the Fund
may be required to buy the underlying security at a disadvantageous price.
These risks are described in greater detail in the Statement of Additional
Information.
- Illiquid and Restricted Securities. Under the policies and
procedures established by the Fund's Board of Trustees, the Manager
determines the liquidity of the Fund's investments. Investments may be
illiquid because of the absence of an active trading market, making it
difficult to value them or dispose of them promptly at an acceptable
price. A restricted security is one that has a contractual restriction on
its resale or which cannot be sold publicly until it is registered under
the Securities Act of 1933. The Fund will not invest more than 10% of its
net assets in illiquid or restricted securities (that limit may increase
to 15% if certain state laws are changed or the Fund's shares are no
longer sold in those states). Certain restricted securities, eligible for
resale to qualified institutional purchasers, are not subject to that
limit.
- Loans of Portfolio Investments. To raise cash for liquidity
purposes, the Fund may lend its portfolio investments to certain types of
eligible borrowers approved by the Board of Trustees. Each loan must be
collateralized in accordance with applicable regulatory requirements.
After any loan, the value of the investments loaned must not exceed 25%
of the value of the Fund's total assets. Repurchase transactions are not
considered "loans" for the purpose of this restriction. There are some
risks in connection with securities lending. The Fund might experience a
delay in receiving additional collateral to secure a loan, or a delay
recovering loaned securities if the borrowing defaults. The Fund presently
does not intend to make loans of investments that will exceed 5% of the
value of the Fund's total assets in the coming year.
- Repurchase Agreements. The Fund may enter into repurchase
agreements. In a repurchase transaction, the Fund buys a security and
simultaneously sell it to the vendor for delivery at a future date. These
are used primarily for cash liquidity purposes.There is no limit on the
amount of the Fund's net assets that may be subject to repurchase
agreements of seven days or less. Repurchase agreements must be fully
collateralized. However, if the vendor of the securities under a
repurchase agreement fails to pay the resale price on the delivery date,
the Fund may incur costs in disposing of the collateral and may experience
losses if there is any delay in its ability to do so. The Fund will not
enter into a repurchase agreement which causes more than 10% of its net
assets to be subject to repurchase agreements having a maturity beyond
seven days.
- Short Sales "Against-the-Box". In a short sale, the seller does not
own the security that is sold, but normally borrows the security to
fulfill this delivery obligation and later buys the security to repay the
loan, in the expectation that the price of the security will be lower when
the purchase is made, resulting in again. The Fund may not sell
securities short except in collateralized transactions referred to as
short sales "against-the-box," where the Fund owns an equivalent amount
of the securities sold short. This technique is primarily used for tax
purposes. No more than 15% of the Fund's net assets will be held as
collateral for short sales at any one time.
- Temporary Defensive Investments. Under unusual economic, political
or business circumstances adversely affecting Mining Securities or Metal
Investments, the Fund may depart from its usual policy of concentrating
at least 80% of its assets in those investments and instead the Fund may
invest a portion of its assets in other types of securities for "defensive
purposes." Securities selected for defensive purposes will usually be
short-term securities and may include debt securities, such as rated or
unrated bonds and debentures, and preferred stocks, cash or cash
equivalents, such as U.S. Treasury Bills and other short-term obligations
of the U.S. Government, its agencies or instrumentalities, or commercial
paper rated "A-1" or better by Standard & Poor's Corporation or "P-1" or
better by Moody's Investors Service, Inc. For defensive purposes, the
Fund may also invest for capital appreciation in equity securities other
than Mining Securities.
Other Investment Restrictions. The Fund has other investment restrictions
which are fundamental policies. Under these fundamental policies, the Fund
cannot do any of the following: (1) invest in Metal Investments if, as a
result, more than 10% of the Fund's total assets would be invested in
Metal Investments; (2) invest either more than 10% of its total assets in
the securities of any one issuer, or, with respect to 75% of its total
assets, invest more than 5% of its total assets in securities of any one
issuer (for this purpose, an "issuer" is one other than the U.S.
Government or its agencies or instrumentalities); (3) acquire more than
10% of the outstanding voting securities of any one issuer; (4) invest in
other open-end investment companies, or invest more than 10% of its net
assets in closed-end investment companies, including small business
investment companies (and investments in closed-end investment companies
may be made only in open-market purchases and only at commission rates
that are not in excess of normal brokerage commissions); (5) lend money
(this does not prohibit the Fund from acquiring publicly-distributed debt
securities that the Fund's other investment policies and restrictions
permit tit to purchase, and the Fund may also make loans of portfolio
securities and Metal Investments (as described above); or (6) deviate from
the percentage limitations on investments set forth in the sections of
"Other Investment Techniques and Strategies" above, (other than those
under "Illiquid and Restricted Securities").
All of the percentage restrictions described above and elsewhere in this
Prospectus (other than the percentage limits that apply to borrowing,
described in the Statement of Additional Information) apply only at the
time the Fund purchases a security, and the Fund need not dispose of a
security merely because the size of the Fund's assets has changed or the
security has increased in value relative to the size of the Fund. There
are other fundamental policies discussed in the Statement of Additional
Information.
How the Fund is Managed
Organization and History. The Fund was originally incorporated in
Maryland in 1983 but was reorganized in 1985 as a Massachusetts business
trust. The Fund is an open-end, diversified management investment company,
with an unlimited number of authorized shares of beneficial interest.
The Fund is governed by a Board of Trustees, which is responsible for
protecting the interests of shareholders under Massachusetts law. The
Trustees meet periodically throughout the year to oversee the Fund's
activities, review its performance, and review the actions of the Manager.
"Trustees and Officers of the Fund" in the Statement of Additional
Information names the Trustees and provides more information about them
and the officers of the Fund. Although the Fund is not required by law
to hold annual meetings, it may hold shareholder meetings from time to
time on important matters, and shareholders have the right to call a
meeting to remove a Trustee or to take other action described in the
Fund's Declaration of Trust.
Presently, the Fund has only one class of shares. However, the Board
of Trustees has the power, without shareholder approval, to divide
unissued shares of the Fund into two or more classes. These classes could
have different dividend and distributions and could be subject to
different expenses.
The Manager and Its Affiliates. The Fund is managed by the Manager,
Oppenheimer Management Corporation, which is responsible for selecting the
Fund's investments and handles its day-to-day business. The Manager
carries out its duties, subject to the policies established by the Board
of Trustees, under an Investment Advisory Agreement which states the
Manager's responsibilities. The Agreement sets forth the fees paid by the
Fund to the Manager, and describes the expenses that the Fund is
responsible to pay to conduct its business.
The Manager has operated as an investment adviser since 1959. The
Manager and its affiliates currently manage investment companies,
including other OppenheimerFunds, with assets of more than $28 billion as
of June 30, 1994, and with more than 1.8 million shareholder accounts.
The Manager is owned by Oppenheimer Acquisition Corp., a holding company
that is owned in part by senior officers of the Manager and controlled by
Massachusetts Mutual Life Insurance Company, a mutual life insurance
company.
- Portfolio Manager. Since September, 1993, James Ayer has been a
Portfolio Manager of the Fund. Since July 16, 1994, he has been the
principal Portfolio Manager and since August 1, 1994 has also been a Vice
President of the Fund. He is an Assistant Vice President of the Manager.
The Manager has designated a Portfolio Manager as the person principally
responsible for the day-to-day management of the Fund's portfolio. Prior
to joining the Manager in 1992, Mr. Ayer was an international equities
investment officer with Brown Brothers Harriman & Company.
- Fees and Expenses. Under the Investment Advisory Agreement, the Fund
pays the Manager the following annual fees, which decline on additional
assets as the Fund grows: 0.75% of the first $200 million of aggregate
net assets, 0.72% of the next $200 million, 0.69% of the next $200
million, 0.66% of the next $200 million and 0.60% of average net assets
over $800 million. The Fund's management fee for its last fiscal year was
0. % of average annual net assets of the Fund, which may be higher than
the rate paid by some other mutual funds. That rate reflected a higher
management fee rate that was in effect during the Fund's last fiscal year
of .80% of the first $200 million of average net assets and .75% of the
next $200 million. The current rates become effective July 1, 1994.
The Fund pays expenses related to its daily operations, such as
custodian fees, Trustees' fees, transfer agency fees, legal and auditing
costs. Those expenses are paid out of the Fund's assets and are not paid
directly by shareholders. However, those expenses reduce the net asset
value of shares, and therefore are indirectly borne by shareholders
through their investment. More information about the investment advisory
agreement and the other expenses paid by the Fund is contained in the
Statement of Additional Information.
There is also information about the Fund's brokerage policies and
practices in "Brokerage Policies of the Fund" in the Statement of
Additional Information. That section discusses how brokers and dealers are
selected for the Fund's portfolio transactions. When deciding which
brokers to use, the Manager is permitted by the investment advisory
agreement to consider whether brokers have sold shares of the Fund or any
other funds for which the Manager serves as investment adviser.
- The Distributor. The Fund's shares are sold through dealers and
brokers that have a sales agreement with Oppenheimer Funds Distributor,
Inc., a subsidiary of the Manager that acts as the Fund's Distributor.
The Distributor also distributes the shares of other mutual funds managed
by the Manager (the "OppenheimerFunds") and is sub-distributor for funds
managed by a subsidiary of the Manager.
- The Transfer Agent. The Fund's transfer agent is Oppenheimer
Shareholder Services, a division of the Manager, which acts as the
shareholder servicing agent for the Fund and the other OppenheimerFunds
on an "at-cost" basis. Shareholders should direct inquiries about their
account to the Transfer Agent at the address and toll-free numbers shown
below in this Prospectus or on the back cover.
Performance of the Fund
Explanation of Performance Terminology. The Fund uses certain terms to
illustrate its performance: "total return" and "average annual total
return." This performance information may be useful to help you see how
well your investment has done and to compare it to other funds or market
indices, as we have done below.
It is important to understand that the fund's total returns represent
past performance and should not be considered to be predictions of future
returns or performance. This performance data is described below, but
more detailed information about how total returns are calculated is
contained in the Statement of Additional Information, which also contains
information about other ways to measure and compare the Fund's
performance. The Fund's investment performance will vary, depending on
market conditions, the composition of the portfolio and expenses.
- Total Returns. There are different types of total returns used to
measure the Fund's performance. Total return is the change in value of
a hypothetical investment in the Fund over a given period, assuming that
all dividends and capital gains distributions are reinvested in additional
shares. The cumulative total return measures the change in value over the
entire period (for example, ten years). An average annual total return
shows the average rate of return for each year in a period that would
produce the cumulative total return over the entire period. However,
average annual total returns do not show the Fund's actual year-by-year
performance.
When total returns are quoted for shares of the Fund, they reflect the
payment of the maximum initial sales charge. Total returns may also be
quoted "at net asset value," without considering the effect of the sales
charge, and those returns would be reduced if sales charges were deducted.
How Has the Fund Performed? Below is a discussion by the Manager of the
Fund's performance during its last fiscal year ended June 30, 1994,
followed by a graphical comparison of the Fund's performance to an
appropriate broad-based market index.
- Management's Discussion of Performance. During the Fund's past
fiscal year, which was marked by slow growth and low inflation in the U.S.
economy and to some extent worldwide, industrial demand for gold continued
to outpace mining output, which tended to enhance gold-stock prices. The
Fund's portfolio manager shifted the emphasis of the gold-stock portion
of the portfolio away from North American companies to companies in other
regions where production and exploration is increasing, such as Latin
America and West Africa. The Manager emphasized selection of stocks of
companies with proven exploration capabilities and improving production
profiles. Additionally, the Manager increased the Fund's investment in
stocks of producers and refiners of other precious and industrial metals,
such as nickel, platinum and copper, as the prices of those stocks have
strengthened along with the general strengthening of worldwide economies.
- Comparing the Fund's Performance to the Market. The chart below
shows the performance of a hypothetical $10,000 investment in shares of
the Fund held until June 30, 1994; over a ten-year period, with all
dividends and capital gains distributions reinvested in additional shares,
held until June 30, 1994. The graph reflects the deduction of the 5.75%
maximum initial sales charge on shares of the Fund.
The Fund's performance is compared to the performance of the Morgan
Stanley World Index, an unmanaged index of issuers listed on the stock
exchanges of 20 foreign countries and the U.S., and is widely recognized
as a measure of global stock market performance. Index performance
reflects the reinvestment of dividends but does not consider the effect
of expenses or taxes. Also, the Fund's performance reflects the effect
of Fund business and operating expenses. While index comparisons may be
useful to provide a benchmark for the Fund's performance, it must be noted
that the Fund's investments are not limited to the securities in the
Morgan Stanley World Index, as the Fund's investments and the Morgan
Stanley World Index emphasize different markets with different degrees of
volatility and returns. Moreover, the index data does not reflect any
assessment of the risk of the investments included in the index.
Oppenheimer Gold & Special Minerals Fund
Comparison of Change in Value
of a $10,000 Hypothetical Investment to the
Morgan Stanley World Index
(Graph)
Past performance is not predictive of future performance.
Oppenheimer Gold & Special Minerals Fund
Average Annual Total Returns at 6/30/94
1-Year 5-Year 10-Year
2.03% 2.94% 9.74%
ABOUT YOUR ACCOUNT
How to Buy Shares
When you buy shares of the Fund, you pay an initial sales charge (on
investments up to $1 million). If you purchase shares of the Fund as part
of an investment of at least $1 million in shares of one or more
OppenheimerFunds, you will not pay any initial sales charge but if you
sell any of those shares within 18 months after your purchase, you will
pay a contingent deferred sales charge, which will vary depending on the
amount you invested.
How Much Must You Invest? You can open a Fund account with a minimum
initial investment of $1,000 and make additional investments at any time
with as little as $25. There are reduced minimum investments under special
investment plans:
With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7)
custodial plans and military allotment plans, you can make initial and
subsequent investments of as little as $25; and subsequent purchases of
at least $25 can be made by telephone through AccountLink.
Under pension and profit-sharing plans and Individual Retirement
Accounts (IRAs), you can make an initial investment of as little as $250
(if your IRA is established under an Asset Builder Plan, the $25 minimum
applies), and subsequent investments may be as little as $25.
There is no minimum investment requirement if you are buying shares
by reinvesting dividends from the Fund or other OppenheimerFunds (a list
of them appears in the Statement of Additional Information, or you can ask
your dealer or call the Transfer Agent), or by reinvesting distributions
from unit investment trusts that have made arrangements with the
Distributor.
- How Are Shares Purchased? You can buy shares several ways -- through
any dealer, broker or financial institution that has a sales agreement
with the Distributor, or directly through the Distributor, or
automatically from your bank account through an Asset Builder Plan under
the OppenheimerFunds AccountLink service.
- Buying Shares Through Your Dealer. Your dealer will place your order
with the Distributor on your behalf.
- Buying Shares Through the Distributor. Complete an OppenheimerFunds
New Account Application and return it with a check payable to "Oppenheimer
Funds Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217.
If you don't list a dealer on the application, the Distributor will act
as your agent in buying the shares.
- Buying Shares Through OppenheimerFunds AccountLink. You can use
AccountLink to link your Fund account with an account at a U.S. bank or
other financial institution that is an Automated Clearing House (ACH)
member, to transmit funds electronically to purchase shares, to send
redemption proceeds, and to transmit dividends and distributions. Shares
are purchased for your account on the regular business day the Distributor
is instructed by you to initiate the ACH transfer to buy shares. You can
provide those instructions automatically, under an Asset Builder Plan,
described below, or by telephone instructions using OppenheimerFunds
PhoneLink, also described below. You must request AccountLink privileges
on the application or dealer settlement instructions used to establish
your account. Please refer to "AccountLink" below for more details.
- Asset Builder Plans. You may purchase shares of the Fund (and up to
four other OppenheimerFunds) automatically each month from your account
at a bank or other financial institution under an Asset Builder Plan with
AccountLink. Details are on the Application and in the Statement of
Additional Information.
- At What Price Are Shares Sold? Shares are sold at the public
offering price based on the net asset value that is next determined after
the Distributor receives the purchase order in Denver. In most cases, to
enable you to receive that day's offering price, the Distributor must
receive your order by 4:00 P.M., New York time (all references to time in
this Prospectus mean "New York time"). The net asset value is determined
as of that time on each day The New York Stock Exchange is open (which is
a "regular business day"). If you buy shares through a dealer, the dealer
must receive your order by 4:00 P.M. on a regular business day and
transmit it to the Distributor so that it is received before the
Distributor's close of business that day, which is normally 5:00 P.M. The
Distributor may reject any purchase order for the Fund's shares, in its
sole discretion.
The public offering price is normally net asset value plus an initial
sales charge. However, in some cases, described below, where purchases
are not subject to an initial sales charge, the offering price may be net
asset value. In some cases, reduced sales charges may be available, as
described below. Out of the amount you invest, the Fund receives the net
asset value to invest for your account. The sales charge varies depending
on the amount of your purchase. A portion of the sales charge may be
retained by the Distributor and allocated to your dealer. The current
sales charge rates and commissions paid to dealers and brokers are as
follows:
<PAGE>
Front-End Sales Charge Commission as
As a Percentage of: Percentage of
Amount of Purchase Offering Price Amount Invested Offering Price
Less than $25,000 5.75% 6.10% 4.75%
$25,000 or more but
less than $50,000 5.50% 5.82% 4.75%
$50,000 or more but
less than $100,000 4.75% 4.99% 4.00%
$100,000 or more but
less than $250,000 3.75% 3.90% 3.00%
$250,000 or more but
less than $500,000 2.50% 2.56% 2.00%
$500,000 or more but
less than $1 million 2.00% 2.04% 1.60%
The Distributor reserves the right to reallow the entire commission to
dealers. If that occurs, the dealer may be considered an "underwriter"
under Federal securities laws.
- Contingent Deferred Sales Charge. There is no initial sales charge
on purchases of Class A shares of any one or more OppenheimerFunds
aggregating $1 million or more (shares of the Fund and other
OppenheimerFunds that offer only one class of shares that has no class
designation are considered "Class A shares" for this purpose). However,
the Distributor pays dealers of record commissions on such purchases in
an amount equal to the sum of 1.0% of the first $2.5 million, plus 0.50%
of the next $2.5 million, plus 0.25% of share purchases over $5 million.
However, that commission will be paid only on the amount of those
purchases in excess of $1 million that were not previously subject to a
front-end sales charge and dealer commission.
If you redeem any of those shares within 18 months of the end of the
calendar month of their purchase, a contingent deferred sales charge will
be deducted from the redemption proceeds. That sales charge will be equal
to 1.0% of the aggregate net asset value of either (1) the redeemed shares
(not including shares purchased by reinvestment of dividends or capital
gain distributions) or (2) the original cost of the shares, whichever is
less. However, the Class A contingent deferred sales charge paid on such
shares will not exceed the aggregate commissions the Distributor paid to
your dealer on all Class A shares of all OppenheimerFunds you purchased
subject to the Class A contingent deferred sales charge. In determining
whether a contingent deferred sales charge is payable, the Fund will first
redeem shares that are not subject to the sales charge, including shares
purchased by reinvestment of dividends and capital gains, and then will
redeem other shares in the order that you purchased them. The contingent
deferred sales charge is waived in certain cases described in "Waivers of
Sales Charges" below.
A contingent deferred sales charge is not charged on exchanges of shares
under the Fund's Exchange Privilege (described below). However, if the
shares acquired by exchange are redeemed within 18 months of the end of
the calendar month of the purchase of the exchanged shares, the sales
charge will apply.
- Special Arrangements With Dealers. The Distributor may advance up
to 13 months' commissions to dealers that have established special
arrangements with the Distributor for Asset Builder Plans for their
clients. Dealers whose sales of Class A shares of OppenheimerFunds (other
than money market funds) under OppenheimerFunds-sponsored 403(b)(7)
custodial plans exceed $5 million per year (calculated per quarter), will
receive monthly one-half of the Distributor's retained commissions on
those sales, and if those sales exceed $10 million per year, those dealers
will receive the Distributor's entire retained commission on those sales.
Reduced Sales Charges. You may be eligible to buy shares of the Fund at
reduced sales charge rates in one or more of the following ways:
- Right of Accumulation. You and your spouse can cumulate Fund shares
you purchase for your own accounts, or jointly, or on behalf of your
children who are minors, under trust or custodial accounts. A fiduciary
can cumulate shares purchased for a trust, estate or other fiduciary
account (including one or more employee benefit plans of the same
employer) that has multiple accounts.
Additionally, you can cumulate current purchases of shares of the Fund
and Class A shares of other OppenheimerFunds with Class A shares of
OppenheimerFunds you previously purchased subject to a sales charge,
provided that you still hold your investment in one of the
OppenheimerFunds. The value of those shares will be based on the greater
of the amount you paid for the shares or their current value (at offering
price). The OppenheimerFunds are listed in "Reduced Sales Charges" in the
Statement of Additional Information, or a list can be obtained from the
Transfer Agent. The reduced sales charge will apply only to current
purchases and must be requested when you buy your shares.
- Letter of Intent. Under a Letter of Intent, you may purchase shares
of the Fund and Class A shares of other OppenheimerFunds during a 13-month
period at the reduced sales charge rate that applies to the aggregate
amount of the intended purchases, including purchases made up to 90 days
before the date of the Letter. More information is contained in the
Application and in "Reduced Sales Charges" in the Statement of Additional
Information.
- Waivers of Sales Charges. No sales charge is imposed on sales of
shares of the Fund to the following investors: (1) the Manager or its
affiliates; (2) present or former officers, directors, trustees and
employees (and their "immediate families" as defined in "Reduced Sales
Charges" in the Statement of Additional Information) of the Fund, the
Manager and its affiliates, and retirement plans established by them for
their employees; (3) registered management investment companies, or
separate accounts of insurance companies having an agreement with the
Manager or the Distributor for that purpose; (4) dealers or brokers that
have a sales agreement with the Distributor, if they purchase shares for
their own accounts or for retirement plans for their employees; (5)
employees and registered representatives (and their spouses) of dealers
or brokers described above or financial institutions that have entered
into sales arrangements with such dealers or brokers (and are identified
to the Distributor) or with the Distributor; the purchaser must certify
to the Distributor at the time of purchase that the purchase is for the
purchaser's own account (or for the benefit of such employee's spouse or
minor children); (6) dealers, brokers or registered investment advisers
that have entered into an agreement with the Distributor providing
specifically for the use of shares of the Fund in particular investment
products made available to their clients.
Additionally, no sales charge is imposed on shares that are (a) issued
in plans of reorganization, such as mergers, asset acquisitions and
exchange offers, to which the Fund is a party, or (b) purchased by the
reinvestment of loan repayments by a participant in a retirement plan for
which the Manager or its affiliates acts as sponsor, or (c) purchased by
the reinvestment of dividends or other distributions reinvested from the
Fund or other OppenheimerFunds (other than Cash Reserves) or unit
investment trusts for which reinvestment arrangements have been made with
the Distributor. There is a further discussion of this policy in "Reduced
Sales Charges" in the Statement of Additional Information.
The contingent deferred sales charge does not apply to purchases at net
asset value described above and is also waived if shares are redeemed in
the following cases: (1) retirement distributions or loans to participants
or beneficiaries from qualified retirement plans, deferred compensation
plans or other employee benefit plans ("Retirement Plans"), (2) returns
of excess contributions made to Retirement Plans, (3) Automatic Withdrawal
Plan payments that are limited to no more than 12% of the original account
value annually, and (4) involuntary redemptions of shares by operation of
law or under the procedures set forth in the Fund's Declaration of Trust
or adopted by the Board of Trustees.
- Service Plan. The Fund has adopted a Service Plan to reimburse the
Distributor for a portion of its costs incurred in connection with the
personal service and maintenance of accounts that hold shares of the Fund.
Reimbursement is made quarterly at an annual rate that may not exceed
0.25% of the average annual net assets of the Fund. The Fund's Board of
Trustees has set the annual rate for assets representing shares of the
Fund sold on or after April 1, 1991 at 0.25%, and has set the rate for
assets representing shares sold before April 1, 1991, at the annual rate
of 0.15% (the Board has the authority to increase that rate but to no more
than 0.25%). The Distributor uses all of those fees to compensate
dealers, brokers, banks and other financial institutions quarterly for
providing personal service and maintenance of accounts of their customers
that hold shares of the Fund and to reimburse itself (if the Fund's Board
of Trustees authorizes such reimbursements, which it has not yet done) for
its other expenditures under the Plan.
Services to be provided include, among others, answering customer
inquiries about the Fund, assisting in establishing and maintaining
accounts in the Fund, making the Fund's investment plans available and
providing other services at the request of the Fund or the Distributor.
Payments are made by the Distributor quarterly at an annual rate not to
exceed 0.25% of the average annual net assets of shares of the Fund held
in accounts of the dealer or its customers. The payments under the Plan
increase the annual expenses of the Fund. For more details, please refer
to "Service Plan" in the Statement of Additional Information.
Special Investor Services
AccountLink. OppenheimerFunds AccountLink links your Fund account to your
account at your bank or other financial institution to enable you to send
money electronically between those accounts to perform a number of types
of account transactions, including purchases of shares by telephone
(either through a service representative or by PhoneLink, described
below), automatic investments under Asset Builder Plans, and sending
dividends and distributions or Automatic Withdrawal Plan payments directly
to your bank account. Please refer to the Application for details or call
the Transfer Agent for more information.
AccountLink privileges must be requested on the Application you use to
buy shares, or on your dealer's settlement instructions if you buy your
shares through your dealer. After your account is established, you can
request AccountLink privileges on signature-guaranteed instructions to the
Transfer Agent. AccountLink privileges will apply to each shareholder
listed in the registration on your account as well as to your dealer
representative of record unless and until the Transfer Agent receives
written instructions terminating or changing those privileges. After you
establish AccountLink for your account, any change of bank account
information must be made by signature-guaranteed instructions to the
Transfer Agent signed by all shareholders who own the account.
- Using AccountLink to Buy Shares. Purchases may be made by telephone
only after your account has been established. To purchase shares in
amounts up to $250,000 through a telephone representative, call the
Distributor at 1-800-852-8457. The purchase payment will be debited from
your bank account.
- PhoneLink. PhoneLink is the OppenheimerFunds automated telephone
system that enables shareholders to perform a number of account
transactions automatically using a touch-tone phone. PhoneLink may be used
on already-established Fund accounts after you obtain a Personal
Identification Number (PIN), by calling the special PhoneLink number: 1-
800-533-3310.
- Purchasing Shares. You may purchase shares in amounts up to $100,000
by phone, by calling 1-800-533-3310. You must have established
AccountLink privileges to link your bank account with the Fund, to pay for
these purchases.
- Exchanging Shares. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your
Fund account to another OppenheimerFunds account you have already
established by calling the special PhoneLink number. Please refer to "How
to Exchange Shares," below, for details.
- Selling Shares. You can redeem shares by telephone automatically by
calling the PhoneLink number and the Fund will send the proceeds directly
to your AccountLink bank account. Please refer to "How to Sell Shares,"
below, for details.
Automatic Withdrawal and Exchange Plans. The Fund has several plans that
enable you to sell shares automatically or exchange them to another
OppenheimerFunds account on a regular basis:
- Automatic Withdrawal Plans. If your Fund account is $5,000 or more,
you can establish an Automatic Withdrawal Plan to receive payments of at
least $50 on a monthly, quarterly, semi-annual or annual basis. The checks
may be sent to you or sent automatically to your bank account on
AccountLink. You may even set up certain types of withdrawals of up to
$1,500 per month by telephone. You should consult the Application and
Statement of Additional Information for more details.
- Automatic Exchange Plans. You can authorize the Transfer Agent to
exchange an amount you establish in advance automatically for shares of
up to five other OppenheimerFunds on a monthly, quarterly, semi-annual or
annual basis under an Automatic Exchange Plan. The minimum purchase for
each other OppenheimerFunds account is $25. These exchanges are subject
to the terms of the Exchange Privilege, described below.
Reinvestment Privilege. If you redeem some or all of your Fund shares,
you have up to 6 months to reinvest all or part of the redemption proceeds
in shares of the Fund or Class A shares of other OppenheimerFunds without
paying sales charge. This privilege applies to Fund shares that you
purchased with an initial sales charge or sell on which you paid a
contingent deferred sales charge when you redeemed them. You must be sure
to ask the Distributor for this privilege when you send your payment.
Please consult the Statement of Additional Information for more details.
Retirement Plans. Fund shares are available as an investment for
retirement plans. If you participate in a plan sponsored by your employer,
the plan trustee or administrator must make the purchase of shares for
your retirement plan account. The Distributor offers a number of different
retirement plans that can be used by individuals and employers:
- Individual Retirement Accounts including rollover IRAs, for
individuals and their spouses
- 403(b)(7) Custodial Plans for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations
- SEP-IRAs (Simplified Employee Pension Plans) for small business
owners or people with income from self-employment, including SARSEP-IRAs
- Pension and Profit-Sharing Plans for self-employed persons and small
business owners
Please call the Distributor for the OppenheimerFunds plan documents,
which contain important information and applications.
How to Sell Shares
You can arrange to take money out of your account on any regular
business day by selling (redeeming) some or all of your shares. Your
shares will be sold at the next net asset value calculated after your
order is received and accepted by the Transfer Agent. The Fund offers you
a number of ways to sell your shares: in writing or by telephone. You can
also set up Automatic Withdrawal Plans to redeem shares on a regular
basis, as described above. If you have questions about any of these
procedures, and especially if you are redeeming shares in a special
situation, such as due to the death of the owner, or from a retirement
plan, please call the Transfer Agent first, at 1-800-525-7048, for
assistance.
- Retirement Accounts. To sell shares in an OppenheimerFunds
retirement account in your name, call the Transfer Agent for a
distribution request form. There are special income tax withholding
requirements for distributions from retirement plans and you must submit
a withholding form with your request to avoid delay. If your retirement
plan account is held for you by your employer, you must arrange for the
distribution request to be sent by the plan administrator or trustee.
There are additional details in the Statement of Additional Information.
- Certain Requests Require a Signature Guarantee. To protect you and
the Fund from fraud, certain redemption requests must be in writing and
must include a signature guarantee in the following situations (there may
be other situations also requiring a signature guarantee):
- You wish to redeem more than $50,000 worth of shares and receive a
check
- The check is not payable to all shareholders listed on the account
statement
- The check is not sent to the address of record on your statement
- Shares are being transferred to a Fund account with a different
owner or name
- Shares are redeemed by someone other than the owners (such as an
Executor)
- Where Can I Have My Signature Guaranteed? The Transfer Agent will
accept a guarantee of your signature by a number of financial
institutions, including: a U.S. bank, trust company, credit union or
savings association, or by a foreign bank that has a U.S. correspondent
bank, or by a U.S. registered dealer or broker in securities, municipal
securities or government securities, or by a U.S. national securities
exchange, a registered securities association or a clearing agency. If you
are signing as a fiduciary or on behalf of a corporation, partnership or
other business, you must also include your title in the signature.
Selling Shares by Mail. Write a "letter of instructions" that includes:
- Your name
- The Fund's name
- Your Fund account number (from your statement)
- The dollar amount or number of shares to be redeemed
- Any special payment instructions
- Any share certificates for the shares you are selling, and
- Any special requirements or documents requested by the Transfer
Agent to assure proper authorization of the person asking to sell shares.
Use the following address for requests by mail: Send courier or Express
Mail requests to:
Oppenheimer Shareholder Services Oppenheimer Shareholder Services
P.O. Box 5270, Denver, Colorado 80217 10200 E. Girard Avenue, Building
Denver, Colorado 80231
Selling Shares by Telephone. You and your dealer representative of record
may also sell your shares by telephone. To receive the redemption price
on a regular business day, your call must be received by the Transfer
Agent by 4:00 P.M. You may not redeem shares held in an OppenheimerFunds
retirement plan or under a share certificate by telephone.
- To redeem shares through a service representative, call 1-800-
852-8457
- To redeem shares automatically on PhoneLink, call 1-800-533-3310
Whichever method you use, you may have a check sent to the address on
the account, or, if you have linked your Fund account to your bank account
on AccountLink, you may have the proceeds wired to that account.
- Telephone Redemptions Paid by Check. Up to $50,000 may be redeemed
by telephone, once in each 7-day period. The check must be payable to all
owners of record of the shares and must be sent to the address on the
account. This service is not available within 30 days of changing the
address on an account.
- Telephone Redemptions Through AccountLink. There are no dollar
limits on telephone redemption proceeds sent to a bank account designated
when you establish AccountLink. Normally the ACH wire to your bank is
initiated on the business day after the redemption. You do not receive
dividends on the proceeds of the shares you redeemed while they are
waiting to be wired.
How to Exchange Shares
Shares of the Fund may be exchanged for shares of certain
OppenheimerFunds at net asset value per share at the time of exchange,
without sales charge. A $5 service fee will be deducted from the fund
account you are exchanging into to help defray administrative costs. That
charge is waived for automated exchanges between already established
accounts on PhoneLink described below. To exchange shares, you must meet
several conditions:
- Shares of the fund selected for exchange must be available for sale
in your state of residence
- The prospectuses of this Fund and the fund whose shares you want to
buy must offer the exchange privilege
- You must hold the shares you buy when you establish your account for
at least 7 days before you can exchange them; after the account is open
7 days, you can exchange shares every regular business day
- You must meet the minimum purchase requirements for the fund you
purchase by exchange
- Before exchanging into a fund, you should obtain and read its
prospectus
Shares of a particular class may be exchanged only for shares of the
same class in the other OppenheimerFunds. For example, you can exchange
shares of this Fund only for Class A shares of another fund. At present,
not all of the OppenheimerFunds offer the same classes of shares. If a
fund has only one class of shares that does not have a class designation,
they are "Class A" shares for exchange purposes. In some cases, sales
charges may be imposed on exchange transactions. Certain OppenheimerFunds
offer Class A shares and either Class B or Class C shares, and a list can
be obtained by calling the Distributor at 1-800-525-7048. Please refer
to "How to Exchange Shares" in the Statement of Additional Information for
more details.
Exchanges may be requested in writing or by telephone:
- Written Exchange Requests. Submit an OppenheimerFunds Exchange
Request form, signed by all owners of the account. Send it to the
Transfer Agent at the addresses listed in "How to Sell Shares."
- Telephone Exchange Requests. Telephone exchange requests may be made
either by calling a service representative at 1-800-852-8457 or by using
PhoneLink for automated exchanges, by calling 1-800-533-3310. Telephone
exchanges may be made only between accounts that are registered with the
same name(s) and address. Shares held under certificates may not be
exchanged by telephone.
You can find a list of OppenheimerFunds currently available for
exchanges in the Statement of Additional Information or by calling the
Transfer Agent at 1-800-525-7048. Exchanges of shares involve a redemption
of the shares of the fund you own and a purchase of shares of the other
fund.
There are certain exchange policies you should be aware of:
- Shares are normally redeemed from one fund and purchased from the
other fund in the exchange transaction on the same regular business day
on which the Transfer Agent receives an exchange request by 4:00 P.M. that
is in proper form, but either fund may delay the purchase of shares of the
fund you are exchanging into if it determines it would be disadvantaged
by a same-day transfer of the proceeds to buy shares. For example, the
receipt of multiple exchange requests from a dealer in a "market-timing"
strategy might require the disposition of securities at a time or price
disadvantageous to the Fund.
- Because excessive trading can hurt fund performance and harm
shareholders, the Fund reserves the right to refuse any exchange request
that will disadvantage it, or to refuse multiple exchange requests
submitted by a shareholder or dealer.
- The Fund may amend, suspend or terminate the exchange privilege at
any time. Although the Fund will attempt to provide you notice whenever
it is reasonably able to do so, it may impose these changes at any time.
- If the Transfer Agent cannot exchange all the shares you request
because of a restriction cited above, only the shares eligible for
exchange will be exchanged.
Shareholder Account Rules and Policies
- Net Asset Value Per Share is determined for shares of the Fund as of
4:00 P.M. each day The New York Stock Exchange is open by dividing the
value of the Fund's net assets by the number of shares that are
outstanding. The Fund's Board of Trustees has established procedures to
value the Fund's securities to determine net asset value. In general,
securities values are based on market value. There are special procedures
for valuing obligations for which market values cannot be readily
obtained, short-term debt securities, call options and hedging
instruments, and Metal Investments. These procedures are described more
completely in the Statement of Additional Information.
- The offering of shares may be suspended during any period in which
the determination of net asset value is suspended, and the offering may
be suspended by the Board of Trustees at any time the Board believes it
is in the Fund's best interest to do so.
- Telephone Transaction Privileges for purchases, redemptions or
exchanges may be modified, suspended or terminated by the Fund at any
time. If an account has more than one owner, the Fund and the Transfer
Agent may rely on the instructions of any one owner. Telephone privileges
apply to each owner of the account and the dealer representative of record
for the account unless and until the Transfer Agent receives cancellation
instructions from an owner of the account.
- The Transfer Agent will record any telephone calls to verify data
concerning transactions and has adopted other procedures to confirm that
telephone instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by
confirming such transactions in writing. If the Transfer Agent does not
use reasonable procedures it may be liable for losses due to unauthorized
transactions, but otherwise it will not be liable for losses or expenses
arising out of telephone instructions reasonably believed to be genuine.
If you are unable to reach the Transfer Agent during periods of unusual
market activity, you may not be able to complete a telephone transaction
and should consider placing your order by mail.
- Redemption or transfer requests will not be honored until the
Transfer Agent receives all required documents in proper form. From time
to time, the Transfer Agent in its discretion may waive certain of the
requirements for redemptions stated in this Prospectus.
- Dealers that can perform account transactions for their clients by
participating in NETWORKING through the National Securities Clearing
Corporation are responsible for obtaining their clients' permission to
perform those transactions and are responsible to their clients who are
shareholders of the Fund if the dealer performs any transaction
erroneously.
- The redemption price for shares will vary from day to day because the
value of the securities in the Fund's portfolio fluctuates. Therefore, the
redemption value of your shares may be more or less than their original
cost.
- Payment for redeemed shares is made ordinarily in cash and forwarded
by check or through AccountLink (as elected by the shareholder under the
redemption procedures described above) within 7 days after the Transfer
Agent receives redemption instructions in proper form, except under
unusual circumstances determined by the Securities and Exchange Commission
delaying or suspending such payments. The Transfer Agent may delay
forwarding a check or processing a payment via AccountLink for recently
purchased shares, but only until the purchase payment has cleared. That
delay may be as much as 15 days from the date the shares were purchased.
That delay may be avoided if you purchase shares by certified check or
arrange with your bank to provide telephone or written assurance to the
Transfer Agent that your purchase payment has cleared.
- Involuntary redemptions of small accounts may be made by the Fund if
the account value has fallen below $500 for reasons other than the fact
that the market value of shares has dropped, and in some cases involuntary
redemptions may be made to repay the Distributor for losses from the
cancellation of share purchase orders.
- "Backup Withholding" of Federal income tax may be applied at the rate
of 31% from dividends, distributions and redemption proceeds (including
exchanges) if you fail to furnish the Fund a certified Social Security or
taxpayer identification number when you sign your application, or if you
violate Internal Revenue Service regulations on tax reporting of
dividends.
- The Fund does not charge a redemption fee, but if your dealer or
broker handles your redemption, they may charge a fee. That fee can be
avoided by redeeming your Fund shares directly through the Transfer Agent.
Under the circumstances described in "How To Buy Shares," you may be
subject to a contingent deferred sales charge when redeeming certain
shares of the Fund.
- To avoid sending duplicate copies of materials to households, the
Fund will mail only one copy of each annual and semi-annual report to
shareholders having the same surname and address on the Fund's records.
However, each shareholder may call the Transfer Agent at 1-800-525-7048
to ask that copies of those materials be sent personally to that
shareholder.
Dividends, Capital Gains and Taxes
Dividends. The Fund declares dividends from net investment income on an
annual basis and normally pays those dividends to shareholders in
December, but the Board of Trustees can change that date. The Board may
also cause the Fund to declare dividends after the close of the Fund's
fiscal year (which ends June 30th). Because the Fund does not have an
objective of seeking current income, the amounts of dividends it pays, if
any, will likely be small.
Capital Gains. The Fund may make distributions annually in December out
of any net short-term or long-term capital gains, and the Fund may make
supplemental distributions of dividends and capital gains following the
end of its fiscal year. Long-term capital gains will be separately
identified in the tax information the Fund sends you after the end of the
year. Short-term capital gains are treated as dividends for tax purposes.
There can be no assurances that the Fund will pay any capital gains
distributions in a particular year.
Distribution Options. When you open your account, specify on your
application how you want to receive your distributions. For
OppenheimerFunds retirement accounts, all distributions are reinvested.
For other accounts, you have four options:
- Reinvest All Distributions in the Fund. You can elect to reinvest
all dividends and long-term capital gains distributions in additional
shares of the Fund.
- Reinvest Long-Term Capital Gains Only. You can elect to reinvest
long-term capital gains in the Fund while receiving dividends by check or
sent to your bank account on AccountLink.
- Receive All Distributions in Cash. You can elect to receive a check
for all dividends and long-term capital gains distributions or have them
sent to your bank on AccountLink.
- Reinvest Your Distributions in Another OppenheimerFunds Account. You
can reinvest all distributions in another OppenheimerFunds account you
have established.
Taxes. If your account is not a tax-deferred retirement account, you
should be aware of the following tax implications of investing in the
Fund. Long-term capital gains are taxable as long-term capital gains when
distributed to shareholders. Dividends paid from short-term capital gains
and net investment income are taxable as ordinary income. Distributions
are subject to federal income tax and may be subject to state or local
taxes. Your distributions are taxable when paid, whether you reinvest
them in additional shares or take them in cash. Every year the Fund will
send you and the IRS a statement showing the amount of each taxable
distribution you received in the previous year.
- "Buying a Dividend": When a fund goes ex-dividend, its share price
is reduced by the amount of the distribution. If you buy shares on or
just before the ex-dividend date, or just before the Fund declares a
capital gains distribution, you will pay the full price for the shares and
then receive a portion of the price back as a taxable dividend or capital
gain.
- Taxes on Transactions: Share redemptions, including redemptions for
exchanges, are subject to capital gains tax. A capital gain or loss is
the difference between the price you paid for the shares and the price you
received when you sold them.
- Returns of Capital: In certain cases distributions made by the Fund
may be considered a non-taxable return of capital to shareholders. If
that occurs, it will be identified in notices to shareholders.
This information is only a summary of certain federal tax information
about your investment. More information is contained in the Statement of
Additional Information, and in addition you should consult with your tax
adviser about the effect of an investment in the Fund on your particular
tax situation.
<PAGE>
APPENDIX TO PROSPECTUS OF
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
Graphic material included in Prospectus of Oppenheimer Gold & Special
Minerals Fund: "Comparison of Total Return of Oppenheimer Gold & Special
Minerals Fund with the Morgan Stanley World Index- Change in Value of a
$10,000 Hypothetical Investment"
A linear graph will be included in the Prospectus of Oppenheimer Gold
& Special Minerals Fund (the "Fund") depicting the initial account value
and subsequent account value of a hypothetical $10,000 investment in the
Fund. The graph will cover each of the Fund's last ten fiscal years from
6/30/84 through 6/30/94. The graph will compare such values with
hypothetical $10,000 investments over the same time periods in the Morgan
Stanley World Index. Set forth below are the relevant data points that
will appear on the linear graph. Additional information with respect to
the foregoing, including a description of the Morgan Stanley World Index,
is set forth in the Prospectus under "Performance of the Fund - Comparing
the Fund's Performance to the Market."
Fiscal Year Oppenheimer Gold & Morgan Stanley
(Period) Ended Special Minerals Fund World Index
06/30/84 $9,425 $10,000
06/30/85 $8,070 $12,659
06/30/86 $7,568 $19,724
06/30/87 $14,557 $28,089
06/30/88 $19,395 $27,794
06/30/89 $20,643 $31,263
06/30/90 $21,283 $33,479
06/30/91 $19,004 $31,839
06/30/92 $19,969 $33,182
06/30/93 $23,392 $38,740
06/30/94 $25,323 $42,707
- - ----------------------
<PAGE>
Oppenheimer Gold & Special Minerals Fund
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048
Investment Advisor
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
Distributor
Oppenheimer Funds Distributor, Inc.
Two World Trade Center
New York, New York 10048-0203
Transfer Agent OPPENHEIMER
Oppenheimer Shareholder Services Gold & Special Minerals Fund
P.O. Box 5270 Prospectus
Denver, Colorado 80217 Effective November 1, 1994
1-800-525-7048
Custodian of Portfolio Securities
The Bank of New York
One Wall Street
New York, New York 10015
Independent Auditors
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202
Legal Counsel
Gordon Altman Butowsky Weitzen
Shalov & Wein
114 West 47th Street OppenheimerFunds
New York, New York 10036
No dealer, broker, salesperson or any other person has been authorized to
give any information or to make any representations other than those
contained in this Prospectus or the Additional Statement and, if given or
made, such information and representations must not be relied upon as
having been authorized by the Fund, Oppenheimer Management Corporation,
Oppenheimer Funds Distributor, Inc. or any affiliate thereof. This
Prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any of the securities offered hereby in any state to any
person to whom it is unlawful to make such an offer in such state.
<PAGE>
Oppenheimer Gold & Special Minerals Fund
Two World Trade Center, New York, New York 10048-0203
1-800-525-7048
Statement of Additional Information dated November 1, 1994
This Statement of Additional Information of Oppenheimer Gold &
Special Minerals Fund is not a Prospectus. This document contains
additional information about the Fund and supplements information in the
Prospectus dated November 1, 1994. It should be read together with the
Prospectus, which may be obtained by writing to the Fund's Transfer Agent,
Oppenheimer Shareholder Services, at P.O. Box 5270, Denver, Colorado 80217
or by calling the Transfer Agent at the toll-free number shown above.
Contents
Page
About the Fund
Investment Objective and Policies . . . . . . . . . . . . . .
Investment Policies and Strategies. . . . . . . . . . .
Other Investment Techniques and Strategies . . . . . . .
Other Investment Restrictions . . . . . . . . . . . . .
How the Fund is Managed . . . . . . . . . . . .. . . . . . .
Organization and History. . . . . . . . . .. . . . . . .
Trustees and Officers of the Fund . . . . .. . . . . . .
The Manager and Its Affiliates. . . . . . .. . . . . . .
Brokerage Policies of the Fund . . . . . . . . .. . . . . . .
Performance of the Fund. . . . . . . . . . . . .. . . . . . .
Service Plan . . . . . . . . . . . . . . . . . .. . . . . . .
About Your Account . . . . . . . . . . . . . . .. . . . . . .
How To Buy Shares. . . . . . . . . . . . . . . .. . . . . . .
How To Sell Shares . . . . . . . . . . . . . . .. . . . . . .
How To Exchange Shares . . . . . . . . . . . . .. . . . . . .
Dividends, Capital Gains and Taxes . . . . . . .. . . . . . .
Additional Information About the Fund. . . . . .. . . . . . .
Financial Information About the Fund . . . . . .. . . . . . .
Independent Auditors' Report . . . . . . . . . . . . . . . .
Financial Statements . . . . . . . . . . . . . . . . . . . .
<PAGE>
ABOUT THE FUND
Investment Objective and Policies
Investment Policies and Strategies. The investment objective and policies
of the Fund are described in the Prospectus. Set forth below is
supplemental information about those policies and the types of securities
in which the Fund invests, as well as the strategies the Fund may use to
try to achieve its objective. Capitalized terms used in this Statement
of Additional Information have the same meaning as those terms have in the
Prospectus.
In selecting securities for the Fund's portfolio, the Fund's
investment advisor, Oppenheimer Management Corporation (the "Manager"),
evaluates the merits of securities primarily through the exercise of its
own investment analysis. This may include, among other things, evaluation
of the history of the issuer's operations, prospects for the industry of
which the issuer is part, the issuer's financial condition, the issuer's
pending product developments and developments by competitors, the effect
of general market and economic conditions on the issuer's business, and
legislative proposals or new laws that might affect the issuer. Current
income is not a consideration in the selection of portfolio securities for
the Fund, whether for appreciation, defensive or liquidity purposes. The
fact that a security has a low yield or does not pay current income will
not be an adverse factor in selecting securities to try to achieve the
Fund's investment objective of capital appreciation unless the Manager
believes that the lack of yield might adversely affect appreciation
possibilities.
The portion of the Fund's assets allocated to securities and methods
selected for capital appreciation will depend upon the judgment of the
Fund's Manager as to the future movement of the equity securities markets.
If the Manager believes that economic conditions favor a rising market,
the Fund will emphasize securities and investment methods selected for
high capital growth. If the Manager believes that a market decline is
likely, defensive securities and investment methods will be emphasized
(See "Temporary Defensive Investments," below).
- Investing in Mining Securities and Metal Investments. The type of
securities that will be emphasized in the Fund's portfolio are Mining
Securities and Metal Investments. Mining Securities are securities of
companies engaged in mining, processing, or distributing gold and other
metals or minerals. Metal Investments consist of gold or silver bullion,
other precious metals, strategic metals, other metals naturally occurring
with such metals, certificates representing an ownership interest in such
metals, and gold or silver coins.
- Special Risks of Concentrating Investments in Mining Securities and
Metal Investments. Investments in Mining Securities and Metal Investments
involve additional risks and considerations not typically associated with
other types of investments: (i) the risk of substantial price
fluctuations of gold and precious metals; (ii) the concentration of gold
supply is mainly in five territories (South Africa, Australia, Russia,
Canada and the United States), and the prevailing economic and political
conditions of these countries may have a direct effect on the production
and marketing of gold and sales of central bank gold holdings; (iii)
unpredictable international monetary policies, economic and political
conditions; (iv) possible U.S. governmental regulation of Metal
Investments, as well as foreign regulation of such investments; and (v)
possible adverse tax consequences for the Fund in making Metal
Investments, if it fails to qualify as a "regulated investment company"
under the Internal Revenue Code.
Because the Fund concentrates its investments in Mining Securities and
Metal Investments, adverse change with respect to any of these risk
factors could have a significant negative effect on the Fund's net asset
value per share. These risks are discussed in greater detail below.
- Risk of Price Fluctuations. The prices of precious and strategic
metals are affected by various factors such as economic conditions,
political events, governmental monetary policies and market events. The
prices of Mining Securities and/or Metal Investments may fluctuate
sharply, which may affect the value of the Fund's shares.
- Concentration of Source of Gold Supply and Control of Gold Sales.
The four largest producers of gold, in current order of magnitude, are the
Republic of South Africa, Russia, Canada and the United States. Economic
and political conditions in those countries may have a direct effect on
the production and marketing of gold and on sales of central bank gold
holdings. In South Africa, the activities of companies engaged in gold
mining are subject to the policies adopted by the Ministry of Mines. The
Reserve Bank of South Africa, as the sole authorized sales agent for South
African gold, has an influence on the price and timing of sales of South
African gold. Political and social conditions in South Africa are still
somewhat unsettled and may pose certain risks to the Fund (in addition to
the risks described below under the caption "Foreign Securities"), because
the Fund may hold a portion of its assets in securities of South African
issuers.
- Unpredictable International Monetary Policies, Economic and
Political Conditions. There is the possibility that unusual international
monetary or political conditions may make the Fund's portfolio assets less
liquid, or that the value of the Fund's assets might be more volatile,
than would be the case with other investments. In particular, the price
of gold is affected by its direct and indirect use to settle net balance
of payments deficits and surpluses between nations. Because the prices
of precious or strategic metals may be affected by unpredictable
international monetary policies and economic conditions, there may be
greater likelihood of a more dramatic fluctuation of the market prices of
the Fund's investments than of other investments.
- Commodities Regulations. The trading of Metal Investments in the
United States could become subject to the rules that govern the trading
of agricultural and certain other commodities and commodity futures. In
the opinion of the Fund's counsel, at present the Fund's permitted Metal
Investments are either not subject to regulation by the Commodity Futures
Trading Commission ("CFTC") or an exemption from regulation is available.
The absence of CFTC regulation may adversely affect the continued
development of an orderly market in Metal Investments trading in the
United States. The development of a regulated futures market in Metal
Investments trading may affect the development of a market in, and the
price of, Metal Investments in the United States.
- Effect on the Fund's Tax Status. By making Metal Investments, the
Fund risks failing to qualify as a regulated investment company under the
Internal Revenue Code. If the Fund should fail to qualify, it would lose
the beneficial tax treatment accorded to qualifying investment companies
under Subchapter M of the Code. Failure to qualify would occur if in any
fiscal year the Fund either (a) derived 10% or more of its gross income
(as defined in the Internal Revenue Code, which disregards losses for this
purpose) from sales or other dispositions of Metal Investments, or (b)
held more than 50% of its net assets in the form of Metal Investments or
in securities not meeting certain tests under the Internal Revenue Code
(see "Dividends, Capital Gains and Taxes"). Accordingly, the Fund will
endeavor to manage its portfolio within the limitations described above,
and the Fund has adopted an investment restriction limiting the amount of
its total assets that can be invested in Metal Investments. There can be
no assurance that the Fund will qualify in every fiscal year.
Furthermore, to comply with the limitations described above, the Fund may
be required to make investment decisions the Manager would otherwise not
make, foregoing the opportunity to realize gains, if necessary, to permit
the Fund to qualify. See "Investment Restrictions."
- Warrants. Warrants basically are options to purchase equity
securities at set prices valid for a specified period of time. The prices
of warrants do not necessarily move in a manner parallel to the prices of
the underlying securities. The price the Fund pays for a warrant will be
lost unless the warrant is exercised prior to its expiration. Warrants
have no voting rights, receive no dividends and have no rights with
respect to the assets of the issuer.
Other Investment Techniques and Strategies
- Writing Covered Calls. As described in the Prospectus, the Fund
may write covered calls. When the Fund writes a call on an investment, it
receives a premium and agrees to sell the callable investment to a
purchaser of a corresponding call during the call period (usually not more
than 9 months) at a fixed exercise price (which may differ from the market
price of the underlying investment) regardless of market price changes
during the call period. To terminate its obligation on a call it has
written, the Fund may purchase a corresponding call in a "closing
purchase transaction." A profit or loss will be realized, depending upon
whether the net of the amount of option transaction costs and the premium
received on the call the Fund has written is more or less than the price
of the call the Fund subsequently purchased. A profit may also be
realized if the call lapses unexercised because the Fund retains the
underlying investment and the premium received. Those profits are
considered short-term capital gains for Federal income tax purposes, as
are premiums on lapsed calls, and when distributed by the Fund are taxable
as ordinary income. If the Fund could not effect a closing purchase
transaction due to the lack of a market, it would have to hold the
callable investment until the call lapsed or was exercised.
The Fund may also write calls on Futures without owning a futures
contract or deliverable securities, provided that at the time the call is
written, the Fund covers the call by segregating in escrow an equivalent
dollar value of liquid assets. The Fund will segregate additional liquid
assets if the value of the escrowed assets drops below 100% of the current
value of the Future. In no circumstances would an exercise notice as to
a Future put the Fund in a short futures position.
The Fund's Custodian, or a securities depository acting for the
Custodian, will act as the Fund's escrow agent, through the facilities of
the Options Clearing Corporation ("OCC"), as to the investments on which
the Fund has written options that are traded on exchanges, or as to other
acceptable escrow securities, so that no margin will be required from the
Fund for such option transactions. OCC will release the securities
covering a call on the expiration of the call or when the Fund enters into
a closing purchase transaction. Call writing affects the Fund's turnover
rate and the brokerage commissions it pays. Commissions, normally higher
than on general securities transactions, are payable on writing or
purchasing a call.
- Hedging With Options and Futures Contracts. The Fund may use
hedging instruments for the purposes described in the Prospectus. When
hedging to attempt to protect against declines in the market value of the
Fund's portfolio, or to permit the Fund to retain unrealized gains in the
value of portfolio securities which have appreciated, or to facilitate
selling securities for investment reasons, the Fund may: (i) sell Stock
Index Futures, (ii) buy puts, or (iii) write covered calls on securities
held by it or on Stock Index Futures (as described in the Prospectus).
When hedging to establish a position in the equity securities markets as
a temporary substitute for the purchase of individual equity securities
the Fund may: (i) buy Stock Index Futures, or (ii) buy calls on Stock
Index Futures or securities. Normally, the Fund would then purchase the
equity securities and terminate the hedging portion.
The Fund's strategy of hedging with Futures and options on Futures will
be incidental to the Fund's investment activities in the underlying cash
market. In the future, the Fund may employ hedging instruments and
strategies that are not presently contemplated but which may be
subsequently developed, to the extent such investment methods are
consistent with the Fund's investment objective, and are legally
permissible and disclosed in the Prospectus. Additional information about
the hedging instruments the Fund may use is provided below.
- Stock Index Futures. As described in the Prospectus, the Fund may
invest in Stock Index Futures only if they relate to broadly-based stock
indices. A stock index is considered to be broadly-based if it includes
stocks that are not limited to issuers in any particular industry or group
of industries. A stock index assigns relative values to the common stocks
included in the index and fluctuates with the changes in the market value
of those stocks. Stock indices cannot be purchased or sold directly.
Stock index futures are contracts based on the future value of the
basket of securities that comprise the underlying stock index. The
contract obligate the seller to deliver, and the purchaser to take, cash
to settle the futures transaction or to enter into an offsetting contract.
No physical delivery of the securities underlying the index is made on
settling the futures obligation. No monetary amount is paid or received
by the Fund on the purchase or sale of a Stock Index Future. Upon
entering into a Futures transaction, the Fund will be required to deposit
an initial margin payment, in cash or U.S. Treasury bills, with the
futures commission merchant (the "futures broker"). Initial margin
payments will be deposited with the Fund's Custodian in an account
registered in the futures broker's name; however, the futures broker can
gain access to that account only under certain specified conditions. As
the Future is marked to market (that is, its value on the Fund's books is
changed) to reflect changes in its market value, subsequent margin
payments, called variation margin, will be paid to or by the futures
broker on a daily basis.
At any time prior to the expiration of the Future, the Fund may
elect to close out its position by taking an opposite position, at which
time a final determination of variation margin is made and additional cash
is required to be paid by or released to the Fund. Any gain or loss is
then realized by the Fund on the Future for tax purposes. Although Stock
Index Futures by their terms call for settlement by the delivery of cash,
in most cases the settlement obligation is fulfilled without such delivery
by entering into an offsetting transaction. All futures transactions are
effected through a clearing house associated with the exchange on which
the contracts are traded.
- Purchasing Puts and Calls. The Fund may purchase calls to protect
against the possibility that the Fund's portfolio will not participate in
an anticipated rise in the securities market. When the Fund purchases a
call (other than in a closing purchase transaction), it pays a premium
and, except as to calls on stock indices, has the right to buy the
underlying investment from a seller of a corresponding call on the same
investment during the call period at a fixed exercise price. In
purchasing a call, the Fund benefits only if the call is sold at a profit
or if, during the call period, the market price of the underlying
investment is above the sum of the call price, transaction costs, and the
premium paid, and the call is exercised. If the call is not exercised or
sold (whether or not at a profit), it will become worthless at its
expiration date and the Fund will lose its premium payment and the right
to purchase the underlying investment. When the Fund purchases a call on
a stock index, it pays a premium, but settlement is in cash rather than
by delivery of the underlying investment to the Fund.
When the Fund purchases a put, it pays a premium and, except as to puts
on stock indices, has the right to sell the underlying investment to a
seller of a corresponding put on the same investment during the put period
at a fixed exercise price. Buying a put on an investment the Fund owns
(a "protective put") enables the Fund to attempt to protect itself during
the put period against a decline in the value of the underlying investment
below the exercise price by selling the underlying investment at the
exercise price to a seller of a corresponding put. If the market price
of the underlying investment is equal to or above the exercise price and
as a result the put is not exercised or resold, the put will become
worthless at its expiration and the Fund will lose the premium payment and
the right to sell the underlying investment. However, the put may be sold
prior to expiration (whether or not at a profit).
Puts and calls on broadly-based stock indices or Stock Index Futures
are similar to puts and calls on securities or futures contracts except
that all settlements are in cash and gain or loss depends on changes in
the index in question (and thus on price movements in the stock market
generally) rather than on price movements of individual securities or
futures contracts. When the Fund buys a call on a stock index or Stock
Index Future, it pays a premium. If the Fund exercises the call during
the call period, a seller of a corresponding call on the same investment
will pay the Fund an amount of cash to settle the call if the closing
level of the stock index or Future upon which the call is based is greater
than the exercise price of the call. That cash payment is equal to the
difference between the closing price of the call and the exercise price
of the call times a specified multiple (the "multiplier") which determines
the total dollar value for each point of difference. When the Fund buys
a put on a stock index or Stock Index Future, it pays a premium and has
the right during the put period to require a seller of a corresponding
put, upon the Fund's exercise of its put, to deliver cash to the Fund to
settle the put if the closing level of the stock index or Stock Index
Future upon which the put is based is less than the exercise price of the
put. That cash payment is determined by the multiplier, in the same
manner as described above as to calls.
When the Fund purchases a put on a stock index, or on a Stock Index
Future not owned by it, the put protects the Fund to the extent that the
index moves in a similar pattern to the securities the Fund holds. The
Fund can either resell the put or, in the case of a put on a Stock Index
Future, buy the underlying investment and sell it at the exercise price.
The resale price of the put will vary inversely with the price of the
underlying investment. If the market price of the underlying investment
is above the exercise price, and as a result the put is not exercised, the
put will become worthless on the expiration date. In the event of a
decline in price of the underlying investment, the Fund could exercise or
sell the put at a profit to attempt to offset some or all of its loss on
its portfolio securities.
The Fund's option activities may affect its portfolio turnover rate and
brokerage commissions. The exercise of calls written by the Fund may
cause the Fund to sell related portfolio securities, thus increasing its
turnover rate. The exercise by the Fund of puts on securities will cause
the sale of underlying investments, increasing portfolio turnover.
Although the decision whether to exercise a put it holds is within the
Fund's control, holding a put might cause the Fund to sell the related
investments for reasons that would not exist in the absence of the put.
The Fund will pay a brokerage commission each time it buys or sells a
call, put or an underlying investment in connection with the exercise of
a put or call. Those commissions may be higher than the commissions for
direct purchases or sales of the underlying investments.
Premiums paid for options are small in relation to the market value
of the underlying investments and, consequently, put and call options
offer large amounts of leverage. The leverage offered by trading in
options could result in the Fund's net asset value being more sensitive
to changes in the value of the underlying investments.
- Regulatory Aspects of Hedging Instruments. The Fund must operate
within certain restrictions as to its long and short positions in Futures
and options thereon under a rule ("CFTC Rule") adopted by the Commodity
Futures Trading Commission ("CFTC") under the Commodity Exchange Act (the
"CEA"). The CEA excludes the Fund from registration with the CFTC as a
"commodity pool operator" (as defined under the CEA), if the Fund complies
with the CFTC Rule. Under these restrictions, the Fund will not, as to
any positions, whether long, short or a combination thereof, enter into
Futures transactions and options thereon for which the aggregate initial
margins and premiums exceed 5% of the fair market value of the Fund's
assets, with certain exclusions as defined in the CFTC Rule. Under the
restrictions, the Fund also must, as to its short positions, use Futures
and options thereon solely for "bona fide hedging purposes" within the
meaning and intent of the applicable provisions of the CEA.
Transactions in options by the Fund are subject to limitations
established by option exchanges governing the maximum number of options
that may be written or held by a single investor or group of investors
acting in concert, regardless of whether the options were written or
purchased on the same or different exchanges or are held in one or more
accounts or through one or more different exchanges or through one or more
brokers. Thus the number of options which the Fund may write or hold may
be affected by options written or held by other entities, including other
investment companies having the same adviser as the Fund (or an adviser
that is an affiliate of the Fund's adviser). The exchanges also impose
position limits on Futures transactions. An exchange may order the
liquidation of positions found to be in violation of those limits and may
impose certain other sanctions.
Due to requirements under the Investment Company Act, when the Fund
purchases a Stock Index Future, the Fund will maintain, in a segregated
account or accounts with its Custodian, cash or readily-marketable, short-
term (maturing in one year or less) debt instruments in an amount equal
to the market value of the securities underlying such Future, less the
margin deposit applicable to it.
- Tax Aspects of Covered Calls and Hedging Instruments. The Fund
intends to qualify as a "regulated investment company" under the Internal
Revenue Code (although it reserves the right not to qualify). That
qualification enables the Fund to "pass through" its income and realized
capital gains to shareholders without having to pay tax on them. This
avoids a "double tax" on that income and capital gains, since shareholders
normally will be taxed on the dividends and capital gains they receive
from the Fund (unless the Fund's shares are held in a retirement account
or the shareholder is otherwise exempt from tax). One of the tests for
the Fund's qualification as a regulated investment company is that less
than 30% of its gross income must be derived from gains realized on the
sale of securities held for less than three months. To comply with this
30% cap, the Fund will limit the extent to which it engages in the
following activities, but will not be precluded from them: (i) selling
investments, including Stock Index Futures, held for less than three
months, whether or not they were purchased on the exercise of a call held
by the Fund; (ii) purchasing options which expire in less than three
months; (iii) effecting closing transactions with respect to calls or puts
written or purchased less than three months previously; (iv) exercising
puts or calls held by the Fund for less than three months; or (v) writing
calls on investments held less than three months.
- Risks of Hedging With Options and Futures. An option position
may be closed out only on a market that provides secondary trading for
options of the same series, and there is no assurance that a liquid
secondary market will exist for any particular option. In addition to the
risks associated with hedging that are discussed in the Prospectus and
above, there is a risk in using short hedging by (i) selling Stock Index
Futures or (ii) purchasing puts on stock indices or Stock Index Futures
to attempt to protect against declines in the value of the Fund's equity
securities. The risk is that the prices of Stock Index Futures will
correlate imperfectly with the behavior of the cash (i.e., market value)
prices of the Fund's equity securities. The ordinary spreads between
prices in the cash and futures markets are subject to distortions, due to
differences in the natures of those markets. First, all participants in
the futures markets are subject to margin deposit and maintenance
requirements. Rather than meeting additional margin deposit requirements,
investors may close out futures contracts through offsetting transactions
which could distort the normal relationship between the cash and futures
markets. Second, the liquidity of the futures markets depends on
participants entering into offsetting transactions rather than making or
taking delivery. To the extent participants decide to make or take
delivery, liquidity in the futures markets could be reduced, thus
producing distortion. Third, from the point of view of speculators, the
deposit requirements in the futures markets are less onerous than margin
requirements in the securities markets. Therefore, increased
participation by speculators in the futures markets may cause temporary
price distortions.
The risk of imperfect correlation increases as the composition of the
Fund's portfolio diverges from the securities included in the applicable
index. To compensate for the imperfect correlation of movements in the
price of the equity securities being hedged and movements in the price of
the hedging instruments, the Fund may use hedging instruments in a greater
dollar amount than the dollar amount of equity securities being hedged if
the historical volatility of the prices of the equity securities being
hedged is more than the historical volatility of the applicable index.
It is also possible that if the Fund has used hedging instruments in a
short hedge, the market may advance and the value of equity securities
held in the Fund's portfolio may decline. If that occurred, the Fund would
lose money on the hedging instruments and also experience a decline in
value in its portfolio securities. However, while this could occur for
a very brief period or to a very small degree, over time the value of a
diversified portfolio of equity securities will tend to move in the same
direction as the indices upon which the hedging instruments are based.
If the Fund uses hedging instruments to establish a position in the
equities markets as a temporary substitute for the purchase of individual
equity securities (long hedging) by buying Stock Index Futures and/or
calls on such Futures, on securities or on stock indices, it is possible
that the market may decline. If the Fund then concludes not to invest in
equity securities at that time because of concerns as to a possible
further market decline or for other reasons, the Fund will realize a loss
on the hedging instruments that is not offset by a reduction in the price
of the equity securities purchased.
- Borrowing for Leverage. From time to time, the Fund may increase
its ownership of securities by borrowing from banks on an unsecured basis
and investing the borrowed funds, subject to the restrictions stated in
the Prospectus. Any such borrowing will be made only from banks, and,
pursuant to the requirements of the Investment Company Act of 1940 (the
"Investment Company Act"), will only be made to the extent that the value
of the Fund's assets, less its liabilities other than borrowings, is equal
to at least 300% of all borrowings including the proposed borrowing. If
the value of the Fund's assets, when computed in that manner, should fail
to meet the 300% asset coverage requirement, the Fund is required within
three days to reduce its bank debt to the extent necessary to meet that
requirement. To do so, the Fund may have to sell a portion of its
investments at a time when independent investment judgment would not
dictate such sale. Interest on money borrowed is an expense the Fund
would not otherwise incur, so that during periods of substantial
borrowings, its expenses may increase more than funds that do not borrow.
- Investing in Small, Unseasoned Companies. The securities of small,
unseasoned companies may have a limited trading market, which may
adversely affect the Fund's ability to dispose of them and can reduce the
price the Fund might be able to obtain for them. If other investment
companies and investors that invest in this type of securities trade the
same securities when the Fund attempts to dispose of its holdings, the
Fund may receive lower prices than might otherwise be obtained, because
of the thinner market for such securities.
- Foreign Securities. "Foreign securities" include equity and debt
securities of companies organized under the laws of countries other than
the United States and debt securities of foreign governments that are
traded on foreign securities exchanges or in the foreign over-the-counter
markets. Securities of foreign issuers that are represented by American
Depository Receipts or that are listed on a U.S. securities exchange or
traded in the U.S. over-the-counter markets are not considered "foreign
securities" for the purpose of the Fund's investment allocations, because
they are not subject to many of the special considerations and risks,
discussed below, that apply to foreign securities traded and held abroad.
Investing in foreign securities offers potential benefits not available
from investing solely in securities of domestic issuers, including the
opportunity to invest in foreign issuers that appear to offer growth
potential, or in foreign countries with economic policies or business
cycles different from those of the U.S., or to reduce fluctuations in
portfolio value by taking advantage of foreign stock markets that do not
move in a manner parallel to U.S. markets. If the Fund's portfolio
securities are held abroad, the countries in which they may be held and
the sub-custodians holding them must be approved by the Fund's Board of
Trustees under applicable rules of the Securities and Exchange Commission.
- Risks of Foreign Investing. Investments in foreign securities
present special additional risks and considerations not typically
associated with investments in domestic securities: reduction of income
by foreign taxes; fluctuation in value of foreign portfolio investments
due to changes in currency rates and control regulations (e.g., currency
blockage); transaction charges for currency exchange; lack of public
information about foreign issuers; lack of uniform accounting, auditing
and financial reporting standards comparable to those applicable to
domestic issuers; less volume on foreign exchanges than on U.S. exchanges;
greater volatility and less liquidity on foreign markets than in the U.S.;
less regulation of foreign issuers, stock exchanges and brokers than in
the U.S.; greater difficulties in commencing lawsuits; higher brokerage
commission rates than in the U.S.; increased risks of delays in settlement
of portfolio transactions or loss of certificates for portfolio
securities; possibilities in some countries of expropriation, confiscatory
taxation, political, financial or social instability or adverse diplomatic
developments; and unfavorable differences between the U.S. economy and
foreign economies. In the past, U.S. Government policies have
discouraged certain investments abroad by U.S. investors, through
taxation or other restrictions, and it is possible that such restrictions
could be re-imposed.
- Restricted and Illiquid Securities. To enable the Fund to sell
restricted securities not registered under the Securities Act of 1933, the
Fund may have to cause those securities to be registered. The expenses
of registration of restricted securities may be negotiated by the Fund
with the issuer at the time such securities are purchased by the Fund,
if such registration is required before such securities may be sold
publicly. When registration must be arranged because the Fund wishes to
sell the security, a considerable period may elapse between the time the
decision is made to sell the securities and the time the Fund would be
permitted to sell them. The Fund would bear the risks of any downward
price fluctuation during that period. The Fund may also acquire, through
private placements, securities having contractual restrictions on their
resale, which might limit the Fund's ability to dispose of such securities
and might lower the amount realizable upon the sale of such securities.
The Fund has percentage limitations that apply to purchases of
restricted securities, as stated in the Prospectus. Those percentage
restrictions do not limit purchases of restricted securities that are
eligible for sale to qualified institutional purchasers pursuant to Rule
144A under the Securities Act of 1933, provided that those securities have
been determined to be liquid by the Board of Trustees of the Fund or by
the Manager under Board-approved guidelines. Those guidelines take into
account the trading activity for such securities and the availability of
reliable pricing information, among other factors. If there is a lack of
trading interest in a particular Rule 144A security, the Fund's holding
of that security may be deemed to be illiquid.
- Loans of Portfolio Investments. The Fund may lend its portfolio
investments subject to the restrictions stated in the Prospectus. Under
applicable regulatory requirements (which are subject to change), the loan
collateral on each business day must at least equal the value of the
loaned securities and must consist of cash, bank letters of credit or
securities of the U.S. Government (or its agencies or instrumentalities).
To be acceptable as collateral, letters of credit must obligate a bank to
pay amounts demanded by the Fund if the demand meets the terms of the
letter. Such terms and the issuing bank must be satisfactory to the Fund.
When it lends securities, the Fund receives amounts equal to the dividends
or interest on loaned securities and also receives one or more of (a)
negotiated loan fees, (b) interest on securities used as collateral, and
(c) interest on short-term debt securities purchased with such loan
collateral. Either type of interest may be shared with the borrower. The
Fund may also pay reasonable finder's, custodian and administrative fees.
The terms of the Fund's loans must meet applicable tests under the
Internal Revenue Code and must permit the Fund to reacquire loaned
securities on five days' notice or in time to vote on any important
matter.
- Repurchase Agreements. The Fund may acquire securities subject to
repurchase agreements for liquidity purposes to meet anticipated
redemptions, or pending the investment of the proceeds from sales of Fund
shares, or pending the settlement of purchases of portfolio securities.
In a repurchase transaction, the Fund acquires a security from, and
simultaneously resells it to, an approved vendor. An "approved vendor"
is a U.S. commercial bank or the U.S. branch of a foreign bank or a
broker-dealer which has been designated a primary dealer in government
securities, which must meet credit requirements set by the Fund's Board
of Trustees from time to time. The resale price exceeds the purchase
price by an amount that reflects an agreed-upon interest rate effective
for the period during which the repurchase agreement is in effect. The
majority of these transactions run from day to day, and delivery pursuant
to the resale typically will occur within one to five days of the
purchase. Repurchase agreements are considered "loans" under the
Investment Company Act, collateralized by the underlying security. The
Fund's repurchase agreements require that at all times while the
repurchase agreement is in effect, the value of the collateral must equal
or exceed the repurchase price to fully collateralize the repayment
obligation. Additionally, the Manager will impose creditworthiness
requirements to confirm that the vendor is financially sound and will
continuously monitor the collateral's value.
- Short Sales Against-the-Box. In this type of short sale, while the
short position is open, the Fund must own an equal amount of the
securities sold short, or by virtue of ownership of other securities have
the right, without payment of further consideration, to obtain an equal
amount of the securities sold short. Short sales against-the-box may be
made to defer, for Federal income tax purposes, recognition of gain or
loss on the sale of securities "in the box" until the short position is
closed out. They may also be used to protect a gain on the security "in-
the-box" when the Fund does not want to sell it and recognize a capital
gain. No more than 15% of the Fund's net assets may be held as collateral
for these short sales.
- Temporary Defensive Investments. If economic, political or
financial conditions adversely affect Mining Securities or Metal
Investments, the Fund may depart from its usual concentration policy and
may commit an increasing portion of its assets to defensive securities.
These may include the types of securities described in the Prospectus.
When investing for defensive purposes, the Fund will normally emphasize
investment in short-term debt securities (that is, securities maturing in
one year or less from the date of purchase), since those types of
securities are generally more liquid and usually may be disposed of
quickly without significant gains or losses so that the Manager may have
liquid assets when it wishes to make investments in securities for
appreciation possibilities.
Other Investment Restrictions
The Fund's most significant investment restrictions are set forth in
the Prospectus. There are additional investment restrictions that the Fund
must follow that are also fundamental policies. Fundamental policies and
the Fund's investment objective cannot be changed without the vote of a
"majority" of the Fund's outstanding voting securities. Under the
Investment Company Act, such a "majority" vote is defined as the vote of
the holders of the lesser of (1) 67% or more of the shares present or
represented by proxy at a shareholder meeting, if the holders of more than
50% of the outstanding shares are present, or (2) more than 50% of the
outstanding shares.
Under these additional restrictions, the Fund cannot: (1) invest in
commodities or commodities contracts; Metal Investments shall not be
deemed an investment in a commodity for the purpose of the Fund's
investment restrictions; however, the Fund may buy and sell any of the
hedging instruments permitted by any of its other non-fundamental or
fundamental policies, whether or not any such hedging instrument is
considered to be a commodity; (2) invest in real estate or in interests
in real estate, but may purchase readily marketable securities of
companies holding real estate or interests therein; (3) purchase
securities on margin; however, the Fund may make margin deposits in
connection with any of the hedging instruments permitted by any of its
other fundamental or non-fundamental policies; (4) mortgage, hypothecate
or pledge any of its assets; however, this does not prohibit the escrow
arrangements contemplated by the option activities of the Fund or other
collateral or margin arrangements in connection with any of the hedging
instruments permitted by any of its other fundamental or non-fundamental
policies; (5) underwrite securities of other companies, except insofar as
the Fund might be deemed to be an underwriter in the resale of any
securities held in its portfolio; (6) invest in or hold securities of any
issuer if those officers and trustees or directors of the Fund or its
adviser owning individually more than .5% of the securities of such issuer
together own more than 5% of the securities of such issuer; (7) invest in
interests in oil or gas exploration or development programs; or (8) invest
in companies for the purpose of acquiring control or management thereof.
How the Fund Is Managed
Organization and History. As a Massachusetts business trust, the Fund is
not required to hold, and does not plan to hold, regular annual meetings
of shareholders. The Fund will hold meetings when required to do so by the
Investment Company Act or other applicable law, or when a shareholder
meeting is called by the Trustees or upon proper request of the
shareholders. Shareholders have the right, upon the declaration in
writing or vote of two-thirds of the outstanding shares of the Fund, to
remove a Trustee. The Trustees will call a meeting of shareholders to
vote on the removal of a Trustee upon the written request of the record
holders of 10% of its outstanding shares. In addition, if the Trustees
receive a request from at least 10 shareholders (who have been
shareholders for at least six months) holding shares of the Fund valued
at $25,000 or more or holding at least 1% of the Fund's outstanding
shares, whichever is less, stating that they wish to communicate with
other shareholders to request a meeting to remove a Trustee, the Trustees
will then either make the Fund's shareholder list available to the
applicants or mail their communication to all other shareholders at the
applicants' expense, or the Trustees may take such other action as set
forth under Section 16(c) of the Investment Company Act.
The Fund's Declaration of Trust contains an express disclaimer of
shareholder or Trustee liability for the Fund's obligations, and provides
for indemnification and reimbursement of expenses out of its property for
any shareholder held personally liable for its obligations. The
Declaration of Trust also provides that the Fund shall, upon request,
assume the defense of any claim made against any shareholder for any act
or obligation of the Fund and satisfy any judgment thereon. Thus, while
Massachusetts law permits a shareholder of a business trust (such as the
Fund) to be held personally liable as a "partner" under certain
circumstances, the risk of a Fund shareholder incurring financial loss on
account of shareholder liability is limited to the relatively remote
circumstances in which the Fund would be unable to meet its obligations
described above. Any person doing business with the Trust, and any
shareholder of the Trust, agrees under the Trust's Declaration of Trust
to look solely to the assets of the Trust for satisfaction of any claim
or demand which may arise out of any dealings with the Trust, and the
Trustees shall have no personal liability to any such person, to the
extent permitted by law.
Trustees and Officers of the Fund. The Fund's Trustees and officers and
their principal occupations and business affiliations during the past five
years are listed below. The address of each Trustee and officer is Two
World Trade Center, New York, New York 10048-0203, unless another address
is listed below. All of the Trustees are also trustees of Oppenheimer
Fund, Oppenheimer Global Fund, Oppenheimer Time Fund, Oppenheimer Special
Fund, Oppenheimer Target Fund, Oppenheimer Discovery Fund, Oppenheimer
Global Growth & Income Fund, Oppenheimer Global Bio-Tech Fund, Oppenheimer
Global Environment Fund, Oppenheimer Tax-Free Bond Fund, Oppenheimer New
York Tax-Exempt Fund, Oppenheimer California Tax-Exempt Fund, Oppenheimer
Multi-State Tax-Exempt Trust, Oppenheimer Asset Allocation Fund,
Oppenheimer Mortgage Income Fund, Oppenheimer U.S. Government Trust,
Oppenheimer Multi-Sector Income Trust and Oppenheimer Multi-Government
Trust (the "New York-based OppenheimerFunds"). Messrs. Spiro, Bishop,
Bowen, Donohue, Farrar and Zack respectively hold the same offices with
the other New York-based OppenheimerFunds as with the Fund. As of
, 1994, the Trustees and officers of the Fund as a group owned less
than 1% of the outstanding shares of the Fund.
Leon Levy, Chairman of the Board of Trustees
General Partner of Odyssey Partners, L.P. (investment partnership) and
Chairman of Avatar Holdings, Inc. (real estate development).
Leo Cherne, Trustee
122 East 42nd Street, New York, New York 10168
Chairman Emeritus of the International Rescue Committee (philanthropic
organization); formerly Executive Director of The Research Institute
of America.
Edmund T. Delaney, Trustee
5 Gorham Road, Chester, Connecticut 06412
Attorney-at-law; formerly a member of the Connecticut State Historical
Commission and Counsel to Copp, Berall & Hempstead (a law firm).
Robert G. Galli, Trustee*
Vice Chairman of the Manager and Vice President and Counsel of
Oppenheimer Acquisition Corp., the Manager's parent holding company;
formerly he held the following positions: a director of the Manager
and Oppenheimer Funds Distributor, Inc. (the "Distributor"), Vice
President and a director of HarbourView Asset Management Corporation
("HarbourView") and Centennial Asset Management Corporation
("Centennial"), investment advisory subsidiaries of the Manager, a
director of Shareholder Financial Services, Inc. ("SFSI") and
Shareholder Services, Inc. ("SSI"), transfer agent subsidiaries of the
Manager, an officer of other OppenheimerFunds and Executive Vice
President and General Counsel of the Manager and the Distributor.
Benjamin Lipstein, Trustee
591 Breezy Hill Road, Hillsdale, New York 12529
Professor Emeritus of Marketing, Stern Graduate School of Business
Administration, New York University.
Elizabeth B. Moynihan, Trustee
801 Pennsylvania Avenue, N.W., Washington, DC 20004
Author and architectural historian; a trustee of the American Schools
of Oriental Research and of the Freer Gallery of Art, Smithsonian
Institution; a member of the Indo-U.S. Sub-Commission on Education and
Culture; a trustee of the Institute of Fine Arts, New York University;
and a trustee of the Preservation League of New York State.
Kenneth A. Randall, Trustee
6 Whittaker's Mill, Williamsburg, Virginia 23185
A director of Northeast Bancorp, Inc. (bank holding company), Dominion
Resources, Inc. (electric utility holding company) and Kemper
Corporation (insurance and financial services company); formerly
Chairman of the Board of ICL, Inc. (information systems).
Edward V. Regan, Trustee
40 Park Avenue, New York, New York 10016
President of Jerome Levy Economics Institute; a member of the U.S.
Competitiveness Policy Council; a director or GranCare, Inc.
(healthcare provider); formerly New York State Comptroller and a
trustee, New York State and Local Retirement Fund.
Russell S. Reynolds, Jr., Trustee
200 Park Avenue, New York, New York 10166
Founder Chairman of Russell Reynolds Associates, Inc. (executive
recruiting); Chairman of Directors Publication, Inc. (consulting and
publishing); a trustee of Mystic Seaport Museum, International House,
Greenwich Hospital and the Greenwich Historical Society.
Sidney M. Robbins, Trustee
50 Overlook Road, Ossining, New York 10562
Chase Manhattan Professor Emeritus of Financial Institutions, Graduate
School of Business, Columbia University; Visiting Professor of
Finance, University of Hawaii; a director of The Korea Fund, Inc. and
The Malaysia Fund, Inc. (closed-end investment companies); a member of
the Board of Advisors, Olympus Private Placement Fund, L.P.; Professor
Emeritus of Finance, Adelphi University.
Donald W. Spiro, President and Trustee*
Chairman Emeritus and a director of the Manager; formerly Chairman of
the Manager and the Distributor.
Pauline Trigere, Trustee
257 West 39th Street, New York, New York 10081
Chairman and Chief Executive Officer of Trigere, Inc. (design and sale
of women's fashions).
Clayton K. Yeutter, Trustee
1325 Merrie Ridge Road, McLean, Virginia 22101
Of Counsel to Hogan & Hartson (a law firm); a director of B.A.T.
Industries, Ltd. (tobacco and financial services), Caterpillar, Inc.
(machinery), ConAgra, Inc. (food and agricultural products), FMC Corp.
(chemicals and machinery), Lindsay Manufacturing Co. and Texas
Instruments, Inc. (electronics); formerly (in descending chronological
order) Deputy Chairman, Bush/Quayle Presidential Campaign, Counsellor
to the President (Bush) for Domestic Policy, Chairman of the
Republican National Committee, Secretary of the U.S. Department of
Agriculture, and U.S. Trade Representative, Executive Office of the
President.
James Ayer, Vice President and Portfolio Manager
Assistant Vice President of the Manager; formerly an international
equities investment officer with Brown Brothers Harriman & Company, a
bank.
Andrew J. Donohue, Secretary
Executive Vice President and General Counsel of the Manager and the
Distributor; an officer of other OppenheimerFunds; formerly Senior
Vice President and Associate General Counsel of the Manager and the
Distributor, prior to which he was a partner in Kraft & McManimon (a
law firm), an officer of First Investors Corporation (a broker-dealer)
and First Investors Management Company, Inc. (broker-dealer and
investment adviser), and a director and an officer of First Investors
Family of Funds and First Investors Life Insurance Company.
George C. Bowen, Treasurer
3410 South Galena Street, Denver, Colorado 80231
Senior Vice President and Treasurer of the Manager; Vice President and
Treasurer of the Distributor and HarbourView; Senior Vice President,
Treasurer, Assistant Secretary and a director of Centennial; Vice
President, Treasurer and Secretary of SSI and SFSI; an officer of
other OppenheimerFunds.
Robert G. Zack, Assistant Secretary
Senior Vice President and Associate General Counsel of the Manager;
Assistant Secretary of SSI and SFSI; an officer of other
OppenheimerFunds.
Robert Bishop, Assistant Treasurer
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other OppenheimerFunds; previously a Fund Controller for
the Manager, prior to which he was an Accountant for Resolution Trust
Corporation and previously an Accountant and Commissions Supervisor
for Stuart James Company Inc., a broker-dealer.
Scott Farrar, Assistant Treasurer
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other OppenheimerFunds; previously a Fund Controller for
the Manager, prior to which he was an International Mutual Fund
Supervisor for Brown Brothers Harriman & Co., a bank, and previously
a Senior Fund Accountant for State Street Bank & Trust Company, before
which he was a sales representative for Central Colorado Planning.
_____________________________________
* A Trustee who is an "interested person" of the Fund as defined in the
Investment Company Act.
- Remuneration of Trustees. The officers of the Fund are affiliated
with the Manager; they and the Trustees of the Fund who are affiliated
with the Manager (Mr. Galli and Mr. Spiro, who is both an officer and
Trustee) receive no salary or fee from the Fund. During the Fund's fiscal
year ended June 30, 1994, the remuneration (including expense
reimbursements) paid to all Trustees of the Fund (excluding Mr. Galli and
Mr. Spiro) as a group for services as trustees and as members of one or
more committees of the Board, totalled $ . The Fund has adopted a
retirement plan that provides for payment to a retired Trustee of up to
80% of the average compensation paid during that Trustee's five years of
service in which the highest compensation was received. A Trustee must
serve in that capacity for any of the New York-based OppenheimerFunds for
at least 15 years to be eligible for the maximum payment. No Trustee has
retired since the adoption of the plan and no payments have been made by
the Fund under the plan. The accumulated liability for the Fund's
projected benefit obligations under the plan was $ as of June 30,
1994.
- Major Shareholders. As of , 1994, no person owned of
record or was known by the Fund to own beneficially 5% or more of the
Fund's outstanding shares.
The Manager and Its Affiliates. The Manager is wholly-owned by
Oppenheimer Acquisition Corp. ("OAC"), a holding company controlled by
Massachusetts Mutual Life Insurance Company. OAC is also owned in part
by certain of the Manager's directors and officers, some of whom also
serve as officers of the Fund, and two of whom (Messrs. Galli and Spiro)
serve as Trustees of the Fund.
- The Investment Advisory Agreement. The investment advisory
agreement between the Manager and the Fund requires the Manager, at its
expense, to provide the Fund with adequate office space, facilities and
equipment, and to provide and supervise the activities of all
administrative and clerical personnel required to provide effective
corporate administration for the Fund, including the compilation and
maintenance of records with respect to its operations, the preparation and
filing of specified reports, and composition of proxy materials and
registration statements for continuous public sale of shares of the Fund.
Expenses not expressly assumed by the Manager under the advisory
agreement or by the Distributor under the General Distributors Agreement
are paid by the Fund. The advisory agreement lists examples of expenses
paid by the Fund, the major categories of which relate to interest, taxes,
brokerage commissions, fees to certain Trustees, legal and audit expenses,
custodian and transfer agent expenses, share issuance costs, certain
printing and registration costs and non-recurring expenses, including
litigation costs. For the Fund's fiscal years ended June 30, 1992, 1993,
and 1994, the management fees paid by the Fund to the Manager were
$1,241,149, $1,061,114, and $ , respectively.
The advisory agreement contains no provision limiting the Fund's
expenses. However, independently of the advisory agreement, the Manager
has undertaken that the total expenses of the Fund in any fiscal year
(including the management fee but excluding taxes, interest, brokerage
commissions, distribution assistance payments and extraordinary expenses
such as litigation costs) shall not exceed the most stringent expense
limitation imposed under state law applicable to the Fund. Pursuant to the
undertaking, the Manager's fee will be reduced at the end of a month so
that there will not be any accrued but unpaid liability under this
undertaking. Currently, the most stringent state expense limitation is
imposed by California, and limits the Fund's expenses (with specified
exclusions) to 2.5% of the first $30 million of average annual net assets,
2% of the next $70 million of average annual net assets, and 1.5% of
average annual net assets in excess of $100 million. The Manager reserves
the right to terminate or amend the undertaking at any time. Any
assumption of the Fund's expenses under this limitation would lower the
Fund's overall expense ratio and increase its total return during any
period in which expenses are limited.
The advisory agreement provides that in the absence of willful
misfeasance, bad faith or gross negligence in the performance of its
duties, or reckless disregard for its obligations and duties under the
advisory agreement, the Manager is not liable for any loss resulting from
a good faith error or omission on its part with respect to any of its
duties thereunder. The advisory agreement permits the Manager to act as
investment adviser for any other person, firm or corporation and to use
the name "Oppenheimer" in connection with other investment companies for
which it may act as investment adviser or general distributor. If the
Manager shall no longer act as investment adviser to the Fund, the right
of the Fund to use the name "Oppenheimer" as part of its name may be
withdrawn.
- The Distributor. Under its General Distributor's Agreement with
the Fund, the Distributor acts as the Fund's principal underwriter in the
continuous public offering of shares but is not obligated to sell a
specific number of shares. Expenses normally attributable to sales,
(other than those expenses paid under the Distribution Plan), including
advertising and the cost of printing and mailing prospectuses, other than
those furnished to existing shareholders, are borne by the Distributor.
During the Fund's fiscal years ended June 30, 1992, 1993, and 1994, the
aggregate sales charges on sales of the Fund's shares were $641,811,
$760,498, and $ , respectively, of which the Distributor and an
affiliated broker-dealer retained in the aggregate $153,640, $202,086 and
$ in those respective years. For additional information about
distribution of the Fund's shares and the expenses connected with such
activities, please refer to "Service Plan," below.
- The Transfer Agent. Oppenheimer Shareholder Services, the Fund's
Transfer Agent, is responsible for maintaining the Fund's shareholder
registry and shareholder accounting records, and for shareholder servicing
and administrative functions.
Brokerage Policies of the Fund
Brokerage Provisions of the Investment Advisory Agreement. One of the
duties of the Manager under the advisory agreement is to arrange the
portfolio transactions for the Fund. The advisory agreement contains
provisions relating to the employment of broker-dealers ("brokers") to
effect the Fund's portfolio transactions. In doing so, the Manager is
authorized by the advisory agreement to employ broker-dealers, including
"affiliated" brokers, as that term is defined in the Investment Company
Act, as may, in its best judgment based on all relevant factors,
implement the policy of the Fund to obtain, at reasonable expense, the
"best execution" (prompt and reliable execution at the most favorable
price obtainable) of such transactions. The Manager need not seek
competitive commission bidding but is expected to minimize the commissions
paid to the extent consistent with the interest and policies of the Fund
as established by its Board of Trustees.
Under the advisory agreement, the Manager is authorized to select
brokers that provide brokerage and/or research services for the Fund
and/or the other accounts over which the Manager or its affiliates have
investment discretion. The commissions paid to such brokers may be higher
than another qualified broker would have charged if a good faith
determination is made by the Manager and the commission is fair and
reasonable in relation to the services provided. Subject to the foregoing
considerations, the Manager may also consider sales of shares of the Fund
and other investment companies managed by the Manager or its affiliates
as a factor in the selection of brokers for the Fund's portfolio
transactions.
Description of Brokerage Practices Followed by the Manager. Subject to
the provisions of the advisory agreement, the procedures and rules
described above, allocations of brokerage are made by portfolio managers
of the Manager under the supervision of the Manager's executive officers.
Transactions in securities other than those for which an exchange is the
primary market are generally done with principals or market makers.
Brokerage commissions are paid primarily for effecting transactions in
listed securities and are otherwise paid only if it appears likely that
a better price or execution can be obtained. When the Fund engages in an
option transaction, ordinarily the same broker will be used for the
purchase or sale of the option and any transaction in the securities to
which the option relates. When possible, concurrent orders to purchase
or sell the same security by more than one of the accounts managed by the
Manager or its affiliates are combined. The transactions effected
pursuant to such combined orders are averaged as to price and allocated
in accordance with the purchase or sale orders actually placed for each
account.
The research services provided by a particular broker may be useful
only to one or more of the advisory accounts of the Manager and its
affiliates, and investment research received for the commissions of those
other accounts may be useful both to the Fund and one or more of such
other accounts. Such research, which may be supplied by a third party at
the instance of a broker, includes information and analyses on particular
companies and industries as well as market or economic trends and
portfolio strategy, receipt of market quotations for portfolio
evaluations, information systems, computer hardware and similar products
and services. If a research service also assists the Manager in a non-
research capacity (such as bookkeeping or other administrative functions),
then only the percentage or component that provides assistance to the
Manager in the investment decision-making process may be paid in
commission dollars.
The research services provided by brokers broadens the scope and
supplement the research activities of the Manager, by making available
additional views for consideration and comparisons, and by enabling the
Manager to obtain market information for the valuation of securities held
in the Fund's portfolio or being considered for purchase. The Board of
Trustees, including the "independent" Trustees of the Fund (those Trustees
of the Fund who are not "interested persons" as defined in the Investment
Company Act, and who have no direct or indirect financial interest in the
operation of the advisory agreement or the Service Plan described below)
annually reviews information furnished by the Manager as to the
commissions paid to brokers furnishing such services so that the Board may
ascertain whether the amount of such commissions was reasonably related
to the value or benefit of such services.
During the Fund's fiscal years ended June 30, 1992, 1993, and 1994,
total brokerage commissions paid by the Fund (not including spreads or
concessions on principal transactions on a net trade basis) were $329,238,
$140,807 and $ , respectively. During the fiscal year ended June
30, 1994, $ was paid to brokers as commissions in return for
research services (including special research, statistical information and
execution); the aggregate dollar amount of those transactions was $ .
The transactions giving rise to those commissions were allocated in
accordance with the Manager's internal allocation procedures.
Performance of the Fund
Total Return Information. As described in the Prospectus, from time to
time the "average annual total return," "cumulative total return,"
"average annual total return at net asset value" and "total return at net
asset value" of an investment in shares of the Fund may be advertised.
An explanation of how these total returns are calculated and the
components of those calculations is set forth below.
The Fund's advertisements of its performance data must, under
applicable rules of the Securities and Exchange Commission, include the
average annual total returns for shares of the Fund for the 1, 5, and 10-
year periods ending as of the most recently-ended calendar quarter prior
to the publication of the advertisement. This enables an investor to
compare the Fund's performance to the performance of other funds for the
same periods. However, a number of factors should be considered before
using such information as a basis for comparison with other investments.
An investment in the Fund is not insured; its returns and share prices are
not guaranteed and normally will fluctuate on a daily basis. When
redeemed, an investor's shares may be worth more or less than their
original cost. Returns for any given past period are not a prediction or
representation by the Fund of future returns. The returns of shares of the
Fund are affected by portfolio quality, the type of investments the Fund
holds and its operating expenses.
- Average Annual Total Returns. The Fund's "average annual total
return" is an average annual compounded rate of return for each year in
a specified number of years. It is the rate of return based on the change
in value of a hypothetical initial investment of $1,000 ("P" in the
formula below) held for a number of years ("n") to achieve an Ending
Redeemable Value ("ERV") of that investment, according to the following
formula:
( ERV ) 1/n
(-----) -1 = Average Annual Total Return
( P )
- Cumulative Total Returns. The cumulative "total return" calculation
measures the change in value of a hypothetical investment of $1,000 over
an entire period of years. Its calculation uses some of the same factors
as average annual total return, but it does not average the rate of return
on an annual basis. Cumulative total return is determined as follows:
ERV - P
- - ------- = Total Return
P
In calculating total returns for shares of the Fund, the current
maximum sales charge of 5.75% (as a percentage of the offering price) is
deducted from the initial investment ("P")(unless the return is shown at
net asset value, as described below). Total returns also assume that all
dividends and capital gains distributions during the period are reinvested
to buy additional shares at net asset value per share, and that the
investment is redeemed at the end of the period. The "average annual
total returns" on an investment in shares of the Fund for the one, five
and ten year periods ended June 30, 1994 were %, % and %,
respectively. The cumulative "total return" on shares of the Fund for the
ten year period ended June 30, 1994 was %.
- Total Returns at Net Asset Value. From time to time the Fund may
also quote an average annual total return at net asset value or a
cumulative total return at net asset value. Each is based on the
difference in net asset value per share at the beginning and the end of
the period for a hypothetical investment in that class of shares (without
considering front-end or contingent deferred sales charges) and takes into
consideration the reinvestment of dividends and capital gains
distributions. The cumulative total return at net asset value of the
Fund's shares for the ten-year period ended June 30, 1994 was %. The
average annual total returns at net asset value for the one, five and ten-
year periods ended June 30, 1994, for shares of the Fund were %,
% and %, respectively.
Total return information may be useful to investors in reviewing
the performance of the Fund. However, when comparing total return of an
investment in shares of the Fund with that of other alternatives,
investors should understand that as the Fund is an aggressive equity fund
seeking capital appreciation, its shares are subject to greater market
risks than shares of funds having other investment objectives and that the
Fund is designed for investors who are willing to accept greater risk of
loss in the hopes of realizing greater gains.
Other Performance Comparisons. From time to time the Fund may publish the
ranking of its shares by Lipper Analytical Services, Inc. ("Lipper"), a
widely-recognized independent service. Lipper monitors the performance of
regulated investment companies, including the Fund, and ranks their
performance for various periods based on categories relating to investment
objectives. The performance of the Fund is ranked against (i) all other
funds and (ii) all other gold-oriented funds. The Lipper performance
rankings are based on total returns that include the reinvestment of
capital gain distributions and income dividends but do not take sales
charges or taxes into consideration.
From time to time the Fund may publish the ranking of its performance
by Morningstar, Inc., an independent mutual fund monitoring service that
ranks mutual funds, including the Fund, monthly in broad investment
categories (equity, taxable bond, municipal bond and hybrid) based on
risk-adjusted investment return. Investment return measures a fund's
three, five and ten-year average annual total returns (when available) in
excess of 90-day U.S. Treasury bill returns after considering sales
charges and expenses. Risk measures reflect fund performance below 90-day
U.S. Treasury bill monthly returns. Risk and return are combined to
produce star rankings reflecting performance relative to the average fund
in a fund's category. Five stars is the "highest" ranking (top 10%), 4
stars is "above average" (next 22.5%), 3 stars is "average" (next 35%),
2 stars is "below average" (next 22.5%) and 1 star is "lowest" (bottom
10%). Morningstar ranks the Fund in relation to other equity funds.
Rankings are subject to change.
Service Plan
The Fund has adopted a Service Plan under Rule 12b-1 of the Investment
Company Act pursuant to which the Fund will reimburse the Distributor
quarterly for all or a portion of its costs incurred in connection with
the servicing of the shares of the Fund, as described in the Prospectus.
The Plan has been approved by a vote of (i) the Board of Trustees of the
Fund, including a majority of the Independent Trustees, cast in person at
a meeting called for the purpose of voting on that Plan, and (ii) the
holders of a "majority" (as defined in the Investment Company Act) of the
shares of the Fund.
In addition, under the Plan the Manager and the Distributor, in their
sole discretion, from time to time may use their own resources (which, in
the case of the Manager, may include profits from the advisory fee it
receives from the Fund) to make payments to brokers, dealers or other
financial institutions (each is referred to as a "Recipient" under the
Plans) for distribution and administrative services they perform. The
Distributor and the Manager may, in their sole discretion, increase or
decrease the amount of payments they make from their own resources to
Recipients.
Unless terminated as described below, the Plan continues in effect from
year to year but only as long as its continuance is specifically approved
at least annually by the Fund's Board of Trustees and its Independent
Trustees by a vote cast in person at a meeting called for the purpose of
voting on such continuance. The Plan may be terminated at any time by the
vote of a majority of the Independent Trustees or by the vote of the
holders of a "majority" (as defined in the Investment Company Act) of the
outstanding shares of the Fund. The Plan may not be amended to increase
materially the amount of payments to be made unless such amendment is
approved by shareholders of the class affected by the amendment. All
material amendments must be approved by the Independent Trustees.
While the Plan is in effect, the Treasurer of the Fund shall provide
a written report to the Fund's Board of Trustees at least quarterly on the
amount of all payments made pursuant to each Plan, the purpose for which
each payment was made and the identity of each Recipient that received any
payment. The report, including the allocations on which it is based, will
be subject to the review and approval of the Independent Trustees in the
exercise of their fiduciary duty. The Plan further provides that while
it is in effect, the selection and nomination of those Trustees of the
Fund who are not "interested persons" of the Fund is committed to the
discretion of the Independent Trustees. This does not prevent the
involvement of others in such selection and nomination if the final
decision on selection or nomination is approved by a majority of the
Independent Trustees.
Under the Plan, no payment will be made to any Recipient in any quarter
if the aggregate net asset value of all Fund shares held by the Recipient
for itself and its customers, does not exceed a minimum amount, if any,
that may be determined from time to time by a majority of the Fund's
Independent Trustees. Initially, the Board of Trustees set no minimum
amount. While the maximum rate under the Plan is 0.25% of average annual
net assets of the Fund, the Board of Trustees has set the maximum rate for
assets representing shares of the Fund acquired before April 1, 1991. For
the fiscal year ended June 30, 1994, payments under the Plan totalled $
, all of which was paid by the Distributor to Recipients, including
$ paid to MML Investor Services, Inc., an affiliate of the
Distributor.
Any unreimbursed expenses incurred by the Distributor with respect to
shares for any fiscal year may not be recovered in subsequent years.
Payments received by the Distributor under the Plan will not be used to
pay any interest expense, carrying charge, or other financial costs, or
allocation of overhead by the Distributor.
ABOUT YOUR ACCOUNT
How To Buy Shares
Determination of Net Asset Values Per Share. The net asset value per
share of shares of the Fund is determined each day The New York Stock
Exchange (the "NYSE") is open, as of 4:00 P.M., New York time, that day,
by dividing the value of the Fund's net assets by the number of shares
outstanding. The NYSE's most recent annual announcement (which is subject
to change) states that it will close on New Year's Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day. It may also close on other days. The Fund may invest
a substantial portion of its assets in foreign securities primarily listed
on foreign exchanges or over-the-counter markets which may trade on
Saturdays or customary U.S. business holidays on which the NYSE is closed.
Because the Fund's price and net asset value will not be calculated on
those days, the Fund's net asset value per share may be significantly
affected on such days when shareholders may not purchase or redeem shares.
The Fund's Board of Trustees has established procedures for the
valuation of the Fund's securities, generally as follows: (i) equity
securities traded on a securities exchange or on NASDAQ for which last
sale information is regularly reported are valued at the last reported
sale price on their primary exchange or NASDAQ that day (or, in the
absence of sales that day, at values based on the last sales prices of the
preceding trading day, or closing bid and asked prices); (ii) securities
traded on NASDAQ and other unlisted equity securities for which last sale
prices are not regularly reported but for which over-the-counter market
quotations are readily available are valued at the highest closing bid
price at the time of valuation, or, if no closing bid price is reported,
on the basis of a closing bid price obtained from a dealer who maintains
an active market in that security; (iii) debt securities having a maturity
in excess of 60 days are valued at the mean between the bid and asked
prices determined by a portfolio pricing service approved by the Board or
obtained from active market makers on the basis of reasonable inquiry;
(iv) short-term debt securities having a remaining maturity of 60 days or
less are valued at cost, adjusted for amortization of premiums and
accretion of discounts; (v) securities (including restricted securities)
not having readily-available market quotations are valued at fair value
under the Board's procedures; (vi) Metal Investments are valued at their
respective fair market values determined on the basis of the mean between
the last current bid and asked prices on exchanges or obtained from dealer
quotations; and (vii) securities traded on foreign exchanges are valued
at the closing or last sales prices reported on a principal exchange, or,
if none, at the mean between closing bid and asked prices and reflect
prevailing rates of exchange taken from the closing price on the London
foreign exchange market that day.
Trading in securities on European and Asian exchanges and over-the-
counter markets is normally completed before the close of the NYSE.
Events affecting the values of foreign securities traded in stock markets
that occur between the time their prices are determined and the close of
the NYSE will not be reflected in the Fund's calculation of net asset
value unless the Board of Trustees or the Manager, under procedures
established by the Board of Trustees, determines that the particular event
would materially affect the Fund's net asset value, in which case an
adjustment would be made. Foreign currency will be valued as close to the
time fixed for the valuation date as is reasonably practicable. The
values of securities denominated in foreign currency will be converted to
U.S. dollars at the prevailing rates of exchange at the time of valuation.
Puts, calls and Futures held by the Fund are valued at the last sales
price on the principal exchange on which they are traded, or on NASDAQ,
as applicable, or, if there are no sales that day, in accordance with (i),
above. Forward currency contracts are valued at the closing price on the
London foreign exchange market. When the Fund writes an option, an amount
equal to the premium received by the Fund is included in the Fund's
Statement of Assets and Liabilities as an asset, and an equivalent
deferred credit is included in the liability section. The deferred credit
is "marked-to-market" to reflect the current market value of the option.
In determining the Fund's gain on investments, if a call written by the
Fund is exercised, the proceeds are increased by the premium received.
If a call or put written by the Fund expires, the Fund has a gain in the
amount of the premium; if the Fund enters into a closing purchase
transaction, it will have a gain or loss depending on whether the premium
was more or less than the cost of the closing transaction. If the Fund
exercises a put it holds, the amount the Fund receives on its sale of the
underlying investment is reduced by the amount of premium paid by the
Fund.
AccountLink. When shares are purchased through AccountLink, each purchase
must be at least $25.00. Shares will be purchased on the regular business
day the Distributor is instructed to initiate the Automated Clearing House
transfer to buy the shares. Dividends will begin to accrue on such shares
on the day the Fund receives Federal Funds for such purchase through the
ACH system before 4:00 P.M., which is normally 3 days after the ACH
transfer is initiated. The Distributor and the Fund are not responsible
for any delays. If the Federal Funds are received after 4:00 P.M.,
dividends will begin to accrue on the next regular business day after such
Federal Funds are received.
Reduced Sales Charges. As discussed in the Prospectus, a reduced sales
charge rate may be obtained under Right of Accumulation and Letters of
Intent because of the economies of sales efforts and reduction in expenses
realized by the Distributor, dealers and brokers making such sales. No
sales charge is imposed in certain other circumstances described in the
Prospectus because the Distributor incurs little or no selling expenses.
The term "immediate family" refers to one's spouse, children,
grandchildren, grandparents, parents, parents-in-law, brothers and
sisters, sons- and daughters-in-law, a sibling's spouse and a spouse's
siblings.
- The OppenheimerFunds. The OppenheimerFunds are those mutual funds
for which the Distributor acts as the distributor or the sub-distributor
and include the following:
Oppenheimer Tax-Free Bond Fund
Oppenheimer New York Tax-Exempt
Fund
Oppenheimer California Tax-
Exempt Fund
Oppenheimer Intermediate Tax-
Exempt Bond Fund
Oppenheimer Insured Tax-Exempt
Bond Fund
Oppenheimer Main Street
California Tax- Exempt
Fund
Oppenheimer Florida Tax-Exempt
Fund
Oppenheimer Pennsylvania Tax-
Exempt Fund
Oppenheimer New Jersey Tax-
Exempt Fund
Oppenheimer Fund
Oppenheimer Discovery Fund
Oppenheimer Time Fund
Oppenheimer Target Fund
Oppenheimer Special Fund
Oppenheimer Equity Income Fund
Oppenheimer Value Stock Fund
Oppenheimer Asset Allocation
Fund
Oppenheimer Total Return Fund,
Inc.
Oppenheimer Main Street Income
& Growth Fund
Oppenheimer High Yield Fund
Oppenheimer Champion High Yield
Fund
Oppenheimer Investment Grade
Bond Fund
Oppenheimer U.S. Government
Trust
Oppenheimer Limited-Term
Government Fund
Oppenheimer Mortgage Income
Fund
Oppenheimer Global Fund
Oppenheimer Global Bio-Tech
Fund
Oppenheimer Global Environment
Fund
Oppenheimer Global Growth &
Income Fund
Oppenheimer Gold & Special
Minerals Fund
Oppenheimer Strategic Income
Fund
Oppenheimer Strategic
Investment Grade Bond Fund
Oppenheimer Strategic Short-
Term Income Fund
Oppenheimer Strategic Income &
Growth Fund
Oppenheimer Strategic
Diversified Income Fund
and the following "Money Market Funds":
Oppenheimer Money Market Fund,
Inc.
Oppenheimer Cash Reserves
Centennial Money Market Trust
Centennial Tax Exempt Trust
Centennial Government Trust
Centennial New York Tax Exempt
Trust
Centennial California Tax
Exempt Trust
Centennial America Fund, L.P.
Daily Cash Accumulation Fund,
Inc.
<PAGE>
There is an initial sales charge on the purchase of Class A shares of
each of the OppenheimerFunds except Money Market Funds (under certain
circumstances described herein, redemption proceeds of Money Market Fund
shares may be subject to a contingent deferred sales charge).
- Letters of Intent. A Letter of Intent ("Letter") is the investor's
statement of intention to purchase shares of the Fund (and Class A shares
of other eligible OppenheimerFunds sold with a front-end sales charge)
during the 13-month period from the investor's first purchase pursuant to
the Letter (the "Letter of Intent period"), which may, at the investor's
request, include purchases made up to 90 days prior to the date of the
Letter. The Letter states the investor's intention to make the aggregate
amount of purchases (excluding any purchases made by reinvestments of
dividends or distributions or purchases made at net asset value without
sales charge), which together with the investor's holdings of such funds
(calculated at their respective public offering prices calculated on the
date of the Letter) will equal or exceed the amount specified in the
Letter. This enables the investor to obtain the reduced sales charge rate
(as set forth in the Prospectus) applicable to purchases of shares in that
amount (the "intended purchase amount"). Each purchase under the Letter
will be made at the public offering price applicable to a single lump-sum
purchase of shares in the intended purchase amount, as described in the
Prospectus.
In submitting a Letter, the investor makes no commitment to purchase
shares, but if the investor's purchases of shares within the Letter of
Intent period, when added to the value (at offering price) of the
investor's holdings of shares on the last day of that period, do not equal
or exceed the intended purchase amount, the investor agrees to pay the
additional amount of sales charge applicable to such purchases, as set
forth in "Terms of Escrow," below (as those terms may be amended from time
to time). The investor agrees that shares equal in value to 5% of the
intended purchase amount will be held in escrow by the Transfer Agent
subject to the Terms of Escrow. Also, the investor agrees to be bound by
the terms of the Prospectus, this Statement of Additional Information and
the Application used for such Letter of Intent, and if such terms are
amended, as they may be from time to time by the Fund, that those
amendments will apply automatically to existing Letters of Intent.
If the total eligible purchases made during the Letter of Intent period
do not equal or exceed the intended purchase amount, the commissions
previously paid to the dealer of record for the account and the amount of
sales charge retained by the Distributor will be adjusted to the rates
applicable to actual purchases. If total eligible purchases during the
Letter of Intent period exceed the intended purchase amount and exceed the
amount needed to qualify for the next sales charge rate reduction set
forth in the applicable prospectus, the sales charges paid will be
adjusted to the lower rate, but only if and when the dealer returns to the
Distributor the excess of the amount of commissions allowed or paid to the
dealer over the amount of commissions that apply to the actual amount of
purchases. The excess commissions returned to the Distributor will be
used to purchase additional shares for the investor's account at the net
asset value per share in effect on the date of such purchase, promptly
after the Distributor's receipt thereof.
In determining the total amount of purchases made under a Letter,
shares redeemed by the investor prior to the termination of the Letter of
Intent period will be deducted. It is the responsibility of the dealer
of record and/or the investor to advise the Distributor about the Letter
in placing any purchase orders for the investor during the Letter of
Intent period. All of such purchases must be made through the
Distributor.
- Terms of Escrow That Apply to Letters of Intent.
1. Out of the initial purchase (or subsequent purchases if necessary)
made pursuant to a Letter, shares of the Fund equal in value to 5% of the
intended purchase amount specified in the Letter shall be held in escrow
by the Transfer Agent. For example, if the intended purchase amount is
$50,000, the escrow shall be shares valued in the amount of $2,500
(computed at the public offering price adjusted for a $50,000 purchase).
Any dividends and capital gains distributions on the escrowed shares will
be credited to the investor's account.
2. If the intended purchase amount specified under the Letter is
completed within the thirteen-month Letter of Intent period, the escrowed
shares will be promptly released to the investor.
3. If, at the end of the thirteen-month Letter of Intent period the
total purchases pursuant to the Letter are less than the intended purchase
amount specified in the Letter, the investor must remit to the Distributor
an amount equal to the difference between the dollar amount of sales
charges actually paid and the amount of sales charges which would have
been paid if the total amount purchased had been made at a single time.
Such sales charge adjustment will apply to any shares redeemed prior to
the completion of the Letter. If such difference in sales charges is not
paid within twenty days after a request from the Distributor or the
dealer, the Distributor will, within sixty days of the expiration of the
Letter, redeem the number of escrowed shares necessary to realize such
difference in sales charges. Full and fractional shares remaining after
such redemption will be released from escrow. If a request is received
to redeem escrowed shares prior to the payment of such additional sales
charge, the sales charge will be withheld from the redemption proceeds.
4. By signing the Letter, the investor irrevocably constitutes and
appoints the Transfer Agent as attorney-in-fact to surrender for
redemption any or all escrowed shares.
5. The shares eligible for purchase under the Letter (or the holding
of which may be counted toward completion of the Letter) do not include
any shares sold without a front-end sales charge or without being subject
to a Class A contingent deferred sales charge unless (for the purpose of
determining completion of the obligation to purchase shares under the
Letter) the shares were acquired in exchange for shares of one of the
OppenheimerFunds whose shares were acquired by payment of a sales charge.
6. Shares held in escrow hereunder will automatically be exchanged for
shares of another fund to which an exchange is requested, as described in
the section of the Prospectus entitled "Exchange Privilege," and the
escrow will be transferred to that other fund.
Asset Builder Plans. To establish an Asset Builder Plan from a bank
account, a check (minimum $25) for the initial purchase must accompany the
application. Shares purchased by Asset Builder Plan payments from bank
accounts are subject to the redemption restrictions for recent purchases
described in "How To Sell Shares," in the Prospectus. Asset Builder Plans
also enable shareholders of Oppenheimer Cash Reserves to use those
accounts for monthly automatic purchases of shares of up to four other
OppenheimerFunds.
There is a front-end sales charge on the purchase of certain
OppenheimerFunds, or a contingent deferred sales charge may apply to
shares purchased by Asset Builder payments. An application should be
obtained from the Distributor, completed and returned, and a prospectus
of the selected fund(s) should be obtained from the Distributor or your
financial advisor before initiating Asset Builder payments. The amount
of the Asset Builder investment may be changed or the automatic
investments may be terminated at any time by writing to the Transfer
Agent. A reasonable period (approximately 15 days) is required after the
Transfer Agent's receipt of such instructions to implement them. The Fund
reserves the right to amend, suspend, or discontinue offering such plans
at any time without prior notice.
Cancellation of Purchase Orders. Cancellation of purchase orders for the
Fund's shares (for example, when a purchase check is returned to the Fund
unpaid) causes a loss to be incurred when the net asset value of the
Fund's shares on the cancellation date is less than on the purchase date.
That loss is equal to the amount of the decline in the net asset value per
share multiplied by the number of shares in the purchase order. The
investor is responsible for that loss. If the investor fails to
compensate the Fund for the loss, the Distributor will do so. The Fund
may reimburse the Distributor for that amount by redeeming shares from any
account registered in that investor's name, or the Fund or the Distributor
may seek other redress.
How to Sell Shares
Information on how to sell shares of the Fund is stated in the
Prospectus. The information below supplements the terms and conditions for
redemptions set forth in the Prospectus.
- Involuntary Redemptions. The Fund's Board of Trustees has the right
to cause the involuntary redemption of the shares held in any account if
the aggregate net asset value of those shares is less than $500 or such
lesser amount as the Board may fix. The Board of Trustees will not cause
the involuntary redemption of shares in an account if the aggregate net
asset value of the shares has fallen below the stated minimum solely as
a result of market fluctuations. Should the Board elect to exercise this
right, it may also fix, in accordance with the Investment Company Act, the
requirements for any notice to be given to the shareholders in question
(not less than 30 days), or the Board may set requirements for granting
permission to the Shareholder to increase the investment, and set other
terms and conditions so that the shares would not be involuntarily
redeemed.
Reinvestment Privilege. Within six months of a redemption, a shareholder
may reinvest all or part of the redemption proceeds of shares of the Fund.
The reinvestment may be made without sales charge only in shares of the
Fund or Class A shares of any of the other OppenheimerFunds into which
shares of the Fund are exchangeable as described below, at the net asset
value next computed after the Transfer Agent receives the reinvestment
order. The shareholder must ask the Distributor for that privilege at the
time of reinvestment. Any capital gain that was realized when the shares
were redeemed is taxable, and reinvestment will not alter any capital
gains tax payable on that gain. If there has been a capital loss on the
redemption, some or all of the loss may not be tax deductible, depending
on the timing and amount of the reinvestment. Under the Internal Revenue
Code, if the redemption proceeds of Fund shares on which a sales charge
was paid are reinvested in shares of the Fund or another of the
OppenheimerFunds within 90 days of payment of the sales charge, the
shareholder's basis in the shares of the Fund that were redeemed may not
include the amount of the sales charge paid. That would reduce the loss
or increase the gain recognized from the redemption. However, in that
case the sales charge would be added to the basis of the shares acquired
by the reinvestment of the redemption proceeds. The Fund may amend,
suspend or cease offering this reinvestment privilege at any time as to
shares redeemed after the date of such amendment, suspension or cessation.
Transfers of Shares. Shares are not subject to the payment of a
contingent deferred sales charge at the time of transfer to the name of
another person or entity (whether the transfer occurs by absolute
assignment, gift or bequest, not involving, directly or indirectly, a
public sale). The transferred shares will remain subject to the
contingent deferred sales charge, calculated as if the transferee
shareholder had acquired the transferred shares in the same manner and at
the same time as the transferring shareholder. If less than all shares
held in an account are transferred, and some but not all shares in the
account would be subject to a contingent deferred sales charge if redeemed
at the time of transfer, then each account shall be allocated a
proportionate number of shares that are not subject to the contingent
deferred sales charge, determined by the ratio of the number of shares
held in the account immediately prior to the transfer.
Distributions From Retirement Plans. Requests for distributions from
OppenheimerFunds-sponsored IRAs, 403(b)(7) custodial plans, or pension or
profit-sharing plans should be addressed to "Trustee, OppenheimerFunds
Retirement Plans," c/o the Transfer Agent at its address listed in "How
To Sell Shares" in the Prospectus or on the back cover of this Statement
of Additional Information. The request must: (i) state the reason for the
distribution; (ii) state the owner's awareness of tax penalties if the
distribution is premature; and (iii) conform to the requirements of the
plan and the Fund's other redemption requirements. Participants (other
than self-employed persons) in OppenheimerFunds-sponsored pension or
profit-sharing plans may not directly request redemption of their
accounts. The employer or plan administrator must sign the request.
Distributions from pension and profit sharing plans are subject to special
requirements under the Internal Revenue Code and certain documents
(available from the Transfer Agent) must be completed before the
distribution may be made. Distributions from retirement plans are subject
to withholding requirements under the Internal Revenue Code, and IRS Form
W-4P (available from the Transfer Agent) must be submitted to the Transfer
Agent with the distribution request, or the distribution may be delayed.
Unless the shareholder has provided the Transfer Agent with a certified
tax identification number, the Internal Revenue Code requires that tax be
withheld from any distribution even if the shareholder elects not to have
tax withheld. The Fund, the Manager, the Distributor, the Trustee and the
Transfer Agent assume no responsibility to determine whether a
distribution satisfies the conditions of applicable tax laws and will not
be responsible for any tax penalties assessed in connection with a
distribution.
Special Arrangements for Repurchase of Shares from Dealers and Brokers.
The Distributor is the Fund's agent to repurchase its shares from
authorized dealers or brokers. The repurchase price will be the net asset
value next computed after the receipt of an order placed by such dealer
or broker, except that orders received from dealers or brokers after 4:00
P.M. on a regular business day will be processed at that day's net asset
value if such orders were received by the dealer or broker from its
customers prior to 4:00 P.M., and were transmitted to and received by the
Distributor prior to its close of business that day (normally 5:00 P.M.).
Payment ordinarily will be made within seven days after the Distributor's
receipt of the required redemption documents, with signature(s) guaranteed
as described in the Prospectus.
Automatic Withdrawal and Exchange Plans. Investors owning shares of the
Fund valued at $5,000 or more can authorize the Transfer Agent to redeem
shares (minimum $50) automatically on a monthly, quarterly, semi-annual
or annual basis under an Automatic Withdrawal Plan. Shares will be
redeemed three business days prior to the date requested by the
shareholder for receipt of the payment. Automatic withdrawals of up to
$1,500 per month may be requested by telephone if payments are to be made
by check payable to all shareholders of record and sent to the address of
record for the account (and if the address has not been changed within the
prior 30 days). Required minimum distributions from OppenheimerFunds-
sponsored retirement plans may not be arranged on this basis. Payments
are normally made by check, but shareholders having AccountLink privileges
(see "How To Buy Shares") may arrange to have Automatic Withdrawal Plan
payments transferred to the bank account designated on the
OppenheimerFunds New Account Application or signature-guaranteed
instructions. The Fund cannot guarantee receipt of a payment on the date
requested and reserves the right to amend, suspend or discontinue offering
such plans at any time without prior notice. Because of the sales charge
assessed on share purchases, shareholders should not make regular
additional share purchases while participating in an Automatic Withdrawal
Plan.
By requesting an Automatic Withdrawal or Exchange Plan, the shareholder
agrees to the terms and conditions applicable to such plans, as stated
below and in the provisions of the OppenheimerFunds Application relating
to such Plans, as well as the Prospectus. These provisions may be amended
from time to time by the Fund and/or the Distributor. When adopted, such
amendments will automatically apply to existing Plans.
- Automatic Exchange Plans. Shareholders can authorize the Transfer
Agent (on the OppenheimerFunds Application or signature-guaranteed
instructions) to exchange a pre-determined amount of shares of the Fund
for Class A shares of other OppenheimerFunds automatically on a monthly,
quarterly, semi-annual or annual basis under an Automatic Exchange Plan.
The minimum amount that may be exchanged to each other fund account is
$25. Exchanges made under these plans are subject to the restrictions
that apply to exchanges as set forth in "How to Exchange Shares" in the
Prospectus and below in this Statement of Additional Information.
- Automatic Withdrawal Plans. Fund shares will be redeemed as
necessary to meet withdrawal payments. Shares acquired without a sales
charge will be redeemed first and shares acquired with reinvested
dividends and capital gains distributions will be redeemed next, followed
by shares acquired with a sales charge, to the extent necessary to make
withdrawal payments. Depending upon the amount withdrawn, the investor's
principal may be depleted. Payments made under withdrawal plans should
not be considered as a yield or income on your investment.
The Transfer Agent will administer the investor's Automatic
Withdrawal Plan (the "Plan") as agent for the investor (the "Planholder")
who executed the Plan authorization and application submitted to the
Transfer Agent. The Transfer Agent shall incur no liability to the
Planholder for any action taken or omitted by the Transfer Agent in good
faith to administer the Plan. Certificates will not be issued for shares
of the Fund purchased for and held under the Plan, but the Transfer Agent
will credit all such shares to the account of the Planholder on the
records of the Fund. Any share certificates held by a Planholder may be
surrendered unendorsed to the Transfer Agent with the Plan application so
that the shares represented by the certificate may be held under the Plan.
For accounts subject to Automatic Withdrawal Plans, distributions of
capital gains must be reinvested in shares of the Fund, which will be done
at net asset value without a sales charge. Dividends on shares held in
the account may be paid in cash or reinvested.
Redemptions of shares needed to make withdrawal payments will be made
at the net asset value per share determined on the redemption date.
Checks or AccountLink payments of the proceeds of Plan withdrawals will
normally be transmitted three business days prior to the date selected for
receipt of the payment (receipt of payment on the date selected cannot be
guaranteed), according to the choice specified in writing by the
Planholder.
The amount and the interval of disbursement payments and the address
to which checks are to be mailed or AccountLink payments are to be sent
may be changed at any time by the Planholder by writing to the Transfer
Agent. The Planholder should allow at least two weeks' time in mailing
such notification for the requested change to be put in effect. The
Planholder may, at any time, instruct the Transfer Agent by written notice
(in proper form in accordance with the requirements of the then-current
Prospectus of the Fund) to redeem all, or any part of, the shares held
under the Plan. In that case, the Transfer Agent will redeem the number
of shares requested at the net asset value per share in effect in
accordance with the Fund's usual redemption procedures and will mail a
check for the proceeds to the Planholder.
The Plan may be terminated at any time by the Planholder by writing to
the Transfer Agent. A Plan may also be terminated at any time by the
Transfer Agent upon receiving directions to that effect from the Fund.
The Transfer Agent will also terminate a Plan upon receipt of evidence
satisfactory to it of the death or legal incapacity of the Planholder.
Upon termination of a Plan by the Transfer Agent or the Fund, shares that
have not been redeemed from the account will be held in uncertificated
form in the name of the Planholder, and the account will continue as a
dividend-reinvestment, uncertificated account unless and until proper
instructions are received from the Planholder or his or her executor or
guardian, or other authorized person.
To use shares held under the Plan as collateral for a debt, the
Planholder may request issuance of a portion of the shares in certificated
form. Upon written request from the Planholder, the Transfer Agent will
determine the number of shares for which a certificate may be issued
without causing the withdrawal checks to stop because of exhaustion of
uncertificated shares needed to continue payments. However, should such
uncertificated shares become exhausted, Plan withdrawals will terminate.
If the Transfer Agent ceases to act as transfer agent for the Fund, the
Planholder will be deemed to have appointed any successor transfer agent
to act as agent in administering the Plan.
How To Exchange Shares
As stated in the Prospectus, shares of a particular class of
OppenheimerFunds having more than one class of shares may be exchanged
only for shares of the same class of other OppenheimerFunds. Shares of
OppenheimerFunds that have a single class without a class designation are
deemed "Class A" shares for this purpose, and all OppenheimerFunds offer
"Class A" shares (except for Oppenheimer Strategic Diversified Income
Fund).
Class A shares of OppenheimerFunds may be exchanged at net asset value
for shares of any Money Market Fund. Shares of any Money Market Fund
purchased without a sales charge may be exchanged for shares of
OppenheimerFunds offered with a sales charge upon payment of the sales
charge (or, if applicable, may be used to purchase shares of
OppenheimerFunds subject to a contingent deferred sales charge). Shares
of this Fund acquired by reinvestment of dividends or distributions from
any other of the OppenheimerFunds or from any unit investment trust for
which reinvestment arrangements have been made with the Distributor may
be exchanged at net asset value for Class A shares of any of the
OppenheimerFunds. No contingent deferred sales charge is imposed on
exchanges of shares purchased subject to a contingent deferred sales
charge. However, when Class A shares acquired by exchange of Class A
shares of other OppenheimerFunds purchased subject to a contingent
deferred sales charge are redeemed within 18 months of the end of the
calendar month of the initial purchase of the exchanged Class A shares,
the contingent deferred sales charge is imposed on the redeemed shares
(see "Contingent Deferred Sales Charge" in the Prospectus). Shareholders
should take into account the effect of any exchange on the applicability
and rate of any contingent deferred sales charge that might be imposed in
the subsequent redemption of remaining shares.
The Fund reserves the right to reject telephone or written exchange
requests submitted in bulk by anyone on behalf of 10 or more accounts. The
Fund may accept requests for exchanges of up to 50 accounts per day from
representatives of authorized dealers that qualify for this privilege. In
connection with any exchange request, the number of shares exchanged may
be less than the number requested if the exchange or the number requested
would include shares subject to a restriction cited in the Prospectus or
this Statement of Additional Information or would include shares covered
by a share certificate that is not tendered with the request. In those
cases, only the shares available for exchange without restriction will be
exchanged.
When exchanging shares by telephone, a shareholder must either have an
existing account in, or obtain and acknowledge receipt of a prospectus of,
the fund to which the exchange is to be made. For full or partial
exchanges of an account made by telephone, any special account features
such as Asset Builder Plans, Automatic Withdrawal Plans and retirement
plan contributions will be switched to the new account unless the Transfer
Agent is instructed otherwise. If all telephone lines are busy (which
might occur, for example, during periods of substantial market
fluctuations), shareholders might not be able to request exchanges by
telephone and would have to submit written exchange requests.
Shares to be exchanged are redeemed on the regular business day the
Transfer Agent receives an exchange request in proper form (the
"Redemption Date"). Normally, shares of the fund to be acquired are
purchased on the Redemption Date, but such purchases may be delayed by
either fund up to five business days if it determines that it would be
disadvantaged by an immediate transfer of the redemption proceeds. The
Fund reserves the right, in its discretion, to refuse any exchange request
that may disadvantage it (for example, if the receipt of multiple exchange
requests from a dealer might require the disposition of portfolio
securities at a time or at a price that might be disadvantageous to the
Fund).
The different OppenheimerFunds available for exchange have different
investment objectives, policies and risks, and a shareholder should assure
that the Fund selected is appropriate for his or her investment and should
be aware of the tax consequences of an exchange. For federal income tax
purposes, an exchange transaction is treated as a redemption of shares of
one fund and a purchase of shares of another. "Reinvestment Privilege,"
above, discusses some of the tax consequences of reinvestment of
redemption proceeds in such cases. The Fund, the Distributor, and the
Transfer Agent are unable to provide investment, tax or legal advice to
a shareholder in connection with an exchange request or any other
investment transaction.
Dividends, Capital Gains and Taxes
Tax Status of the Fund's Dividends and Distributions. The Federal tax
treatment of the Fund's dividends and capital gains distributions is
explained in the Prospectus under the caption "Dividends, Capital Gains
and Taxes." Special provisions of the Internal Revenue Code govern the
eligibility of the Fund's dividends for the dividends-received deduction
for corporate shareholders. Long-term capital gains distributions are not
eligible for the deduction. In addition, the amount of dividends paid by
the Fund which may qualify for the deduction is limited to the aggregate
amount of qualifying dividends that the Fund derives from its portfolio
investments that the Fund has held for a minimum period, usually 46 days.
A corporate shareholder will not be eligible for the deduction on
dividends paid on Fund shares held for 45 days or less. To the extent the
Fund's dividends are derived from gross income from option premiums,
interest income or short-term gains from the sale of securities or
dividends from foreign corporations, those dividends will not qualify for
the deduction.
Under the Internal Revenue Code, by December 31 each year, the Fund
must distribute 98% of its taxable investment income earned from January
1 through December 31 of that year and 98% of its capital gains realized
in the period from November 1 of the prior year through October 31 of the
current year, or else the Fund must pay an excise tax on the amounts not
distributed. While it is presently anticipated that the Fund will meet
those requirements, the Fund's Board of Trustees and the Manager might
determine in a particular year that it would be in the best interest of
shareholders for the Fund not to make such distributions at the required
levels and to pay the excise tax on the undistributed amounts. That would
reduce the amount of income or capital gains available for distribution
to shareholders.
If the Fund has more than 50% of its total assets invested in foreign
securities at the end of its fiscal year, it may elect the application of
Section 853 of the Internal Revenue Code to permit shareholders to take
a credit (or, at their option, a deduction) for foreign taxes paid by the
Fund. Under Section 853, shareholders would be entitled to treat the
foreign taxes withheld from interest and dividends paid to the Fund from
its foreign investments as a credit on their federal income taxes. As an
alternative, shareholders could, if to their advantage, treat the foreign
tax withheld as a deduction from gross income in computing taxable income
rather than as a tax credit. In substance, the Fund's election would
enable shareholders to benefit from the same foreign tax credit or
deduction that would be received if they had been the record owners of the
Fund's foreign securities and had paid foreign taxes on the income
received.
If the Fund qualifies as a "regulated investment company" under the
Internal Revenue Code, it will not be liable for Federal income taxes on
amounts paid by it as dividends and distribution. The Fund qualified
during its last fiscal year, and intends to qualify in current and future
years, but reserves the right not to do so. The Internal Revenue Code
contains a number of complex tests relating to such qualification in which
the Fund derives 30% or more of its gross income from the sale of
securities held less than three months, it may fail to qualify (see
"Investment Objective and Policies-Tax Aspects of Hedging Instruments" in
the Statement of Additional Information). If it did not so qualify, the
Fund would be treated for tax purposes as an ordinary corporation and
receive no tax deduction for payments made to shareholders.
The Fund's investments in Metal Investments could result in the Fund's
failing to meet the Internal Revenue Code's prescribed income or asset
tests to qualify as a "regulated investment company." This would occur
if, during a fiscal year, the Fund either (i) derived 10% or more of its
gross income from Metal Investments, or (ii) held more than 50% of its net
assets, determined at the end of each fiscal quarter, in Metal Investments
and/or securities (other than U.S. Government securities) as to which
securities either (a) the Fund had more than 5% of its total assets
invested; or (b) the Fund held more than 10% of the outstanding voting
securities of the issuer of such securities. Accordingly, the Fund will
endeavor to manage its portfolio within the above limitations, but there
can be no assurance that it will be successful in doing so.
Dividend Reinvestment in Another Fund. Shareholders of the Fund may elect
to reinvest all dividends and/or capital gains distributions in Class A
shares of the same class of any of the other OppenheimerFunds listed in
"Reduced Sales Charges," above, at net asset value without sales charge.
To elect this option, a shareholder must notify the Transfer Agent in
writing and either have an existing account in the fund selected for
reinvestment or must obtain a prospectus for that fund and an application
from the Distributor to establish an account. The investment will be made
at the net asset value per share in effect at the close of business on the
payable date of the dividend or distribution. Dividends and/or
distributions from shares of other the OppenheimerFunds may be invested
in shares of this Fund on the same basis.
Additional Information About the Fund
The Custodian. The Bank of New York is the Custodian of the Fund's
assets. The Custodian's responsibilities include safeguarding and
controlling the Fund's portfolio securities, collecting income on the
portfolio securities and handling the delivery of such securities to and
from the Fund. The Manager has represented to the Fund that the banking
relationships between the Manager and the Custodian have been and will
continue to be unrelated to and unaffected by the relationship between the
Fund and the Custodian. It will be the practice of the Fund to deal with
the Custodian in a manner uninfluenced by any banking relationship the
Custodian may have with the Manager and its affiliates.
Independent Auditors. The independent auditors of the Fund audit the
Fund's financial statements and perform other related audit services.
They also act as auditors for certain other funds advised by the Manager
and its affiliates.
<PAGE>
Investment Adviser
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048
Distributor
Oppenheimer Funds Distributor, Inc.
Two World Trade Center
New York, New York 10048
Transfer and Shareholder Servicing Agent
Oppenheimer Shareholder Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048
Custodian of Portfolio Securities
The Bank of New York
One Wall Street
New York, NY 10015
Independent Auditors
KPMG Peat Marwick, LLP
707 Seventeenth Street
Denver, Colorado 80202
Legal Counsel
Gordon Altman Butowsky Weitzen Shalov & Wein
114 West 47th Street
New York, New York 10036
<PAGE>
<PAGE>
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24 Financial Statements and Exhibits
(a) Financial Statements
(1) Condensed Financial Information (See Part A, Prospectus):
To be filed by Post-Effective Amendment.
(2) Report of Independent Auditors (see Part B, Statement of
Additional Information): To be filed by Post-Effective
Amendment.
(3) Statement of Investments (see Part B, Statement of
Additional Information): To be filed by Post-Effective
Amendment.
(4) Statement of Assets and Liabilities (see Part B, Statement
of Additional Information): To be filed by Post-Effective
Amendment.
(5) Statement of Operations (see Part B, Statement of Additional
Information): To be filed by Post-Effective Amendment.
(6) Statements of Changes in Net Assets (see Part B, Statement
of Additional Information): To be filed by Post-Effective
Amendment.
(7) Notes to Financial Statements (see Part B, Statement of
Additional Information): To be filed by Post-Effective
Amendment.
(8) Independent Auditors' Consent: To be filed by Post-
Effective Amendment.
(b) Exhibits
Exhibit
Number Description
(1) Declaration of Trust dated October 7, 1985: Previously filed with
Post-Effective Amendment No. 5 to Registrant's Registration
Statement, 11/1/85, refiled herewith pursuant to Item 102 of
Regulation S-T, and incorporated herein by reference.
(2) By-Laws amended as of 8/6/87: Previously filed with Post-Effective
Amendment No. 10 to Registrant's Registration Statement, 10/28/88,
refiled herewith pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(3) Not applicable.
(4) Specimen Share Certificate: Previously filed with Registrant's
Post-Effective Amendment No. 5 to Registrant's Registration
Statement, 11/1/85, and incorporated herein by reference.
(5) Investment Advisory Agreement dated June 20, 1991: Previously filed
with Registrant's Post-Effective Amendment No. 14, August 30, 1991,
refiled herewith pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(6) (a)General Distributor's Agreement dated 12/10/92: Previously
filed with Registrant's Post-Effective Amendment No. 18 to
Registrant's Registration Statement, 8/2/93, and incorporated
herein by reference.
(b)Form of Dealer Agreement of Oppenheimer Funds Distributor, Inc.:
Previously filed with Post-Effective Amendment No. 12 of
Oppenheimer Government Securities Fund (Reg. No. 33-02769),
12/2/92, and incorporated herein by reference.
(c)Form of Oppenheimer Funds Distributor, Inc. Broker Agreement:
Previously filed with Post-Effective Amendment No. 12 of
Oppenheimer Government Securities Fund (Reg. No. 33-02769),
12/2/92, and incorporated herein by reference.
(d)Broker Agreement between Oppenheimer Funds Distributor, Inc. and
Newbridge Securities dated 10/1/86: Previously filed with Post-
Effective Amendment No. 25 of Oppenheimer Special Fund (Reg. No.
2-45272), 11/1/86, and incorporated herein by reference.
(e)Form of Oppenheimer Funds Distributor, Inc. Agency Agreement:
Previously filed with Post-Effective Amendment No. 12 of
Oppenheimer Government Securities Fund (Reg. No. 33-02769),
12/2/92, and incorporated herein by reference.
(7) Retirement Plan for Non-Interested Trustees or Directors (adopted
by Registrant - 6/7/90): Previously filed with Post-Effective
Amendment No. 97 of Oppenheimer Fund (Reg. No. 2-14586), 8/30/90,
and incorporated herein by reference.
(8) Custody Agreement dated 11/12/92: Previously filed with
Registrant's Post-Effective Amendment No. 18 to Registrant's
Registration Statement, 8/2/93, and incorporated herein by
reference.
(9) Agreement and Plan of Reorganization and Liquidation dated 10/10/85
by and between Registrant and Oppenheimer Gold & Special Minerals
Fund, Inc.: Previously filed with Registrant's Post-Effective
Amendment No. 5, 11/1/85, refiled herewith pursuant to Item 102 of
Regulation S-T, and incorporated herein by reference.
(10) Opinion and Consent of Counsel dated 10/4/85: Previously filed with
Registrant's Post-Effective Amendment No. 5, 11/1/85, refiled
herewith pursuant to Item 102 of Regulation S-T, and incorporated
herein by reference.
(11) Not applicable.
(12) Not applicable.
(13) Investment Letter dated 5/31/83 from Oppenheimer Management
Corporation to Registrant: Previously filed with Registrant's
Post-Effective Amendment No. 10, 10/28/88, refiled herewith
pursuant to Item 102 of Regulation S-T, and incorporated herein by
reference.
(14) (a)Form of Standardized and Non-Standardized Profit-Sharing Plan
and Money Purchase Pension Plan for self-employed persons and
corporations: Previously filed with Post-Effective Amendment No.
3 of Oppenheimer Global Growth & Income Fund (Reg. No. 33-33799),
1/31/92, and incorporated herein by reference.
(b)Form of Individual Retirement Account Trust Agreement:
Previously filed with Post-Effective Amendment No. 21 of
Oppenheimer U.S. Government Trust (Reg. No. 2-76645), 8/25/93, and
incorporated herein by reference.
(c)Form of Tax Sheltered Retirement Plan and Custody Agreement for
employees of public schools and tax-exempt organizations:
Previously filed with Post-Effective Amendment No. 22 of
Oppenheimer Directors Fund (Reg. No. 2-62240), 2/1/90, and
incorporated herein by reference.
(d)Form of Simplified Employee Pension IRA: Previously filed with
Post-Effective Amendment No. 36 of Oppenheimer Equity Income Fund
(Reg. No. 2-33043), 10/23/91, and incorporated herein by reference.
(e)Form of SAR-SEP Simplified Employee Pension IRA: Filed with
Post-Effective Amendment No. 19 to the Registration Statement for
Oppenheimer Integrity Funds (File No. 2-76547), 3/1/94, and
incorporated herein by reference.
(15) Service Plan and Agreement dated June 10, 1993: Previously filed
with Post-Effective Amendment No. 18 to Registrant's Registration
Statement, 8/2/93, and incorporated herein by reference.
(16) Performance Data Computation Schedule: To be filed by Post-
Effective Amendment.
- - -- Powers of Attorney (including certified Board resolutions):
Previously filed with Post-Effective Amendment No. 18 to
Registrant's Registration Statement, 8/2/93, and incorporated
herein by reference.
ITEM 25 Persons Controlled by or Under Common Control with Registrant
None
ITEM 26 Number of Holders of Securities
Number of Record
Holders as of
Title of Class , 1994
Shares of Beneficial Interest
ITEM 27 Indemnification
Reference is made to paragraphs (c) through (g) of Section 12 of Article
SEVENTH of Registrant's Declaration of Trust filed as Exhibit 24(b)(1) to
this Registration Statement.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons
of Registrant pursuant to the foregoing provisions or otherwise,
Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by Registrant of expenses incurred or paid by a
trustee, officer or controlling person of Registrant in the successful
defense of any action, suit or proceeding) is asserted by such trustee,
officer or controlling person, Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of
such issue.
ITEM 28 Business and Other Connections of Investment Adviser
(a) Oppenheimer Management Corporation is the investment adviser of
the Registrant; it and certain subsidiaries and affiliates act in
the same capacity for other registered investment companies as
described in Parts A and B hereof.
(b) For information as to the business, profession, vocation or
employment of a substantial nature of each of the principal
officers and the directors of Oppenheimer Management Corporation,
reference is made to Parts A and B of this Registration Statement
and to the registration on Form ADV filed under the Investment
Advisers Act of 1940 by Oppenheimer Management Corporation, which
is incorporated herein by reference.
ITEM 29 Principal Underwriter
(a) Oppenheimer Funds Distributor, Inc. is the General Distributor of
Registrant's shares, and is also the general distributor of each
of other open-end registered investment companies for which
Oppenheimer Management Corporation is the investment adviser, as
described in Parts A and B of this Registration Statement.
(b) The information contained in the registration on Form BD of
Oppenheimer Funds Distributor, Inc., filed under the Securities
Exchange Act of 1934, is incorporated herein by reference.
(c) Not applicable.
ITEM 30 Location of Accounts and Records
The accounts, books and other documents required to be maintained by
Registrant pursuant to Section 31(a) of the Investment Company Act of 1940
and rules promulgated thereunder are in the possession of Oppenheimer
Management Corporation, at its offices at 3410 South Galena Street,
Denver, Colorado 80231.
ITEM 31 Management Services
Not applicable.
ITEM 32 Undertakings
(a) Not applicable.
(b) Not applicable.
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and/or the
Investment Company Act of 1940, the Registrant has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York and State of New York
on the 30th day of August, 1994.
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
By:
/s/ Donald W. Spiro*
Donald W. Spiro, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities on the dates indicated:
Signatures Title Date
- - ---------- ----- ----
Chairman of the
/s/ Leon Levy* Board of Trustees August 30, 1994
Leon Levy
President, Principal
/s/ Donald W. Spiro* Executive Officer
Donald W. Spiro and Trustee August 30, 1994
Treasurer and
/s/ George Bowen* Principal Financial
George Bowen and Accounting
Officer August 30, 1994
Trustee August 30, 1994
/s/ Leo Cherne*
Leo Cherne
Trustee August 30, 1994
/s/ Edmund T. Delaney*
Edmund T. Delaney
Trustee August 30, 1994
/s/ Robert G. Galli*
Robert G. Galli
Trustee August 30, 1994
/s/ Benjamin Lipstein*
Benjamin Lipstein
Trustee August 30, 1994
/s/ Elizabeth B. Moynihan*
Elizabeth B. Moynihan
Trustee August 30, 1994
/s/ Kenneth A. Randall*
Kenneth A. Randall
Trustee August 30, 1994
/s/ Edward V. Regan*
Edward V. Regan
Trustee August 30, 1994
/s/ Russell S. Reynolds, Jr.*
Russell S. Reynolds, Jr.
Trustee August 30, 1994
/s/ Sidney M. Robbins*
Sidney M. Robbins
Trustee August 30, 1994
/s/ Pauline Trigere*
Pauline Trigere
Trustee August 30, 1994
/s/ Clayton K. Yeutter*
Clayton K. Yeutter
*By: /s/ Robert G. Zack
Robert G. Zack, Attorney-in-Fact
<PAGE>
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
EXHIBIT INDEX
Form N-1A
Item No. Description
24(b)(1) Declaration of Trust dated October 7, 1985
24(b)(2) By-Laws amended as of 8/6/87
24(b)(5) Investment Advisory Agreement dated June 20, 1991
24(b)(9) Agreement and Plan of Reorganization and Liquidation dated
10/10/85 by and between Registrant and Oppenheimer Gold &
Special Minerals Fund, Inc.
24(b)(10) Opinion and Consent of Counsel dated 10/4/85
24(b)(13) Investment Letter dated 5/31/83 from Oppenheimer Management
Corporation to Registrant
DECLARATION OF TRUST
OF
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
DECLARATION OF TRUST, made October 7, 1985 by and among the
individuals executing this Declaration of Trust as the initial Trustees.
WHEREAS, the Trustees desire to establish a trust fund under the laws
of the Commonwealth of Massachusetts, for the investment and reinvestment
of funds contributed thereto;
NOW, THEREFORE, the Trustees declare that all money and property
contributed to the trust fund hereunder shall be held and managed under
this Declaration of Trust IN TRUST as herein set forth below.
FIRST: This Trust shall be known as OPPENHEIMER GOLD & SPECIAL
MINERALS FUND.
SECOND: Whenever used herein, unless otherwise required by the
context or specifically provided:
1. All terms used in this Declaration of Trust which are
defined in the 1940 Act (defined below) shall have the meanings given to
them in the 1940 Act.
2. "Board" or "Board of Trustees" or the "Trustees" means the
Board of Trustees of the Trust.
3. "By-Laws" means the By-Laws of the Trust as amended from
time to time.
4. "Commission" means the Securities and Exchange Commission.
5. "Declaration of Trust" shall mean this Declaration of Trust
as amended or restated from time to time.
6. The "1940 Act" refers to the Investment Company Act of 1940
and the Rules and Regulations of the Commission thereunder, all as amended
from time to time.
7. "Series" refers to Series of Shares established and
designated under or in accordance with the provisions of Article FOURTH.
8. "Shareholder" means a record owner of Shares of the Trust.
9. "Shares" refers to the transferable units of interest into
which the beneficial interest in the Trust or any Series of the Trust (as
the context may require) shall be divided from time to time and includes
fractions of Shares as well as whole Shares.
10. The "Trust" refers to the Massachusetts business trust
created by this Declaration of Trust, as amended or restated from time to
time.
11. "Trustees" refers to the individual trustees in their
capacity as trustees hereunder of the Trust and their successor or
successors for the time being in office as such trustees.
THIRD: The purpose or purposes for which the Trust is formed and the
business or objects to be transacted, carried on and promoted by it are
as follows:
1. To hold, invest or reinvest its funds, and in connection
therewith to hold part or all of its funds in cash, and to
purchase or otherwise acquire, hold for investment or otherwise,
sell, sell short, assign, negotiate, transfer, exchange or
otherwise dispose of or turn to account or realize upon,
securities (which term "securities" shall for the purposes of
this Declaration of Trust, without limitation of the generality
thereof, be deemed to include any stocks, shares, bonds,
financial futures contracts, indexes, debentures, notes,
mortgages and other obligations, and any certificates, receipts,
warrants or other instruments representing rights to receive,
purchase or subscribe for the same, or evidencing or
representing any other rights or interests therein, or in any
property or assets) created or issued by any issuer (which term
"issuer" shall for the purposes of this Declaration of Trust,
without limitation of the generality thereof be deemed to
include any persons, firms, associations, corporations,
syndicates, combinations, organizations, governments, or
subdivisions thereof) and in financial instruments (whether they
are considered as securities or commodities); and to exercise,
as owner or holder of any securities or financial instruments,
all rights, powers and privileges in respect thereof; and to do
any and all acts and things for the preservation, protection,
improvement and enhancement in value of any or all such
securities or financial instruments.
2. To borrow money and pledge assets in connection with any of
the objects or purposes of the Trust, and to issue notes or
other obligations evidencing such borrowings, to the extent
permitted by the 1940 Act and by the Trust's fundamental
investment policies under the 1940 Act.
3. To issue and sell its Shares in such Series and amounts and
on such terms and conditions, for such purposes and for such
amount or kind of consideration (including without limitation
thereto, securities) now or hereafter permitted by the laws of
the Commonwealth of Massachusetts and by this Declaration of
Trust, as the Trustees may determine.
4. To purchase or otherwise acquire, hold, dispose of, resell,
transfer, reissue or cancel its Shares, or to classify or
reclassify any unissued Shares of any Shares previously issued
and reacquired of any Series into one or more series that may
have been established and designated from time to time, all
without the vote or consent of the Shareholders of the Trust,
in any manner and to the extent now or hereafter permitted by
this Declaration of Trust.
5. To conduct its business in all its branches at one or more
offices in New York and elsewhere in any part of the world,
without restriction or limit as to extent.
6. To carry out all or any of the foregoing objects and
purposes as principal or agent, and alone or with associates or
to the extent now or hereafter permitted by the laws of
Massachusetts, as a member of, or as the owner or holder of any
stock of, or share of interest in, any issuer, and in connection
therewith to make or enter into such deeds or contracts with any
issuers and to do such acts and things and to exercise such
powers, as a natural person could lawfully make, enter into, do
or exercise.
7. To do any and all such further acts and things and to
exercise any and all such further powers as may be necessary,
incidental, relative, conducive, appropriate or desirable for
the accomplishment, carrying out or attainment of all or any of
the foregoing purposes or objects.
The foregoing objects and purposes shall, except as otherwise
expressly provided, be in no way limited or restricted by reference to,
or inference from, the terms of any other clause of this or any other
Article of this Declaration of Trust, and shall each be regarded as
independent and construed as powers as well as objects and purposes, and
the enumeration of specific purposes, objects and powers shall not be
construed to limit or restrict in any manner the meaning of general terms
or the general powers of the Trust now or hereafter conferred by the laws
of the Commonwealth of Massachusetts nor shall the expression of one thing
be deemed to exclude another, though it be of a similar or dissimilar
nature, not expressed; provided, however, that the Trust shall not carry
on any business, or exercise any powers, in any state, territory, district
or country except to the extent that the same may lawfully be carried on
or exercised under the laws thereof.
FOURTH: (A) The beneficial interest in the Trust shall be divided
into Shares, all without par value, but the Trustees shall have the
authority from time to time to create one or more Series of Shares in
addition to the Series specifically established and designated in part (B)
of this Article FOURTH, as they deem necessary or desirable, to establish
and designate such Series, and to fix and determine the relative rights
and preferences as between the different Series of Shares as to right of
redemption and the price, terms and manner of redemption, special and
relative rights as to dividends and other distributions and on
liquidation, sinking or purchase fund provisions, conversion on
liquidation, sinking or purchase fund provisions, conversion rights, and
conditions under which the several Series shall have individual voting
rights or no voting rights. Except as aforesaid, all Shares of the
different Series shall be identical.
The number of authorized Shares and the number of Shares of each
Series that may be issued is unlimited, and the Trustees may issue Shares
of any Series for such consideration and on such terms as they may
determine (or for no consideration if pursuant to a Share dividend or
split-up), all without action or approval of the Shareholders. All Shares
when so issued on the terms determined by the Trustees shall be fully paid
and non-assessable. The Trustees may classify or reclassify any unissued
Shares or any Shares previously issued and reacquired of any Series into
one or more Series that may be established and designated from time to
time. The Trustees may hold as treasury Shares (of the same or some other
Series), reissue for such consideration and on such terms as they may
determine, or cancel, at their discretion from time to time, any Shares
of any Series reacquired by the Trust.
The establishment and designation of any Series of Shares in addition
to that established and designated in part (B) of this Article FOURTH
shall be effective upon the execution by a majority of the Trustees of an
instrument setting forth such establishment and designation and the
relative rights and preferences of such Series, or as otherwise provided
in such instrument. At any time that there are no Shares outstanding of
any particular Series previously established and designated, the Trustees
may by an instrument executed by a majority of their number abolish that
Series and the establishment and designation thereof. Each instrument
referred to in this paragraph shall have the status of an amendment to
this Declaration of Trust.
Any Trustee, officer or other agent of the Trust, and any
organization in which any such person is interested may acquire, own, hold
and dispose of Shares of any Series of the Trust to the same extent as if
such person were not a Trustee, officer or other agent of the Trust; and
the Trust may issue and sell or cause to be issued and sold and may
purchase Shares of any Series from any such person or any such
organization subject only to the general limitations, restrictions or
other provisions applicable to the sale or purchase of Shares of such
Series generally.
(B) Without limiting the authority of the Trustees set forth in part
(A) of this Article FOURTH to establish and designate any further Series,
the Trustees hereby establish one Series of Shares having the same name
as the Trust. The Shares of that Series and any Shares of any further
Series that may from time to time be established and designated by the
Trustees shall (unless the Trustees otherwise determine with respect to
some further Series at the time of establishing and designated the same)
have the following relative rights and preferences:
(i) Assets Belonging to Series. All consideration received by the
Trust for the issue or sale of Shares of a particular Series, together
with all assets in which such consideration is invested or reinvested, all
income, earnings, profits, and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation of such assets, and any
funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to that Series for
all purposes, subject only to the rights of creditors, and shall be so
recorded upon the books of account of the Trust. Such consideration,
assets, income, earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets,
and any funds or payments derived from any reinvestment of such proceed,
in whatever form the same may be, together with any General Items
allocated to that Series as provided in the following sentence, are herein
referred to as "assets belonging to" that Series. In the event that there
are any assets, income, earnings, profits, and proceeds thereof, funds,
or payments which are not readily identifiable as belonging to any
particular Series (collectively "General Items"), the Trustees shall
allocate such General Items to and among any one or more of the Series
established and designated from time to time in such manner and on such
basis as they, in their sold discretion, deem fair and equitable; and any
General Items so allocated to a particular Series shall belong to that
Series. Each such allocation by the Trustees shall be conclusive and
binding upon the shareholders of all Series for all purposes.
(ii) Liabilities Belonging to Series. The assets belonging to each
particular Series shall be charged with the liabilities of the Trust in
respect of that Series and all expenses, costs, charges and reserves
attributable to that Series, and any general liabilities, expenses, costs,
charges or reserves of the Trust which are not readily identifiable as
belonging to any particular Series shall be allocated and charged by the
Trustees to and among any one or more of the Series shall be allocated and
charged by the Trustees to and among any one or more of the Series
established and designated from time to time in such manner and on such
basis as the Trustees in their sole discretion deem fair and equitable.
The liabilities, expenses, costs, charges and reserves allocated and so
charged to a Series are herein referred to as "liabilities belonging to"
that Series. Each allocation of liabilities, expenses, costs, charges and
reserves by the Trustees shall be conclusive and binding upon the holders
of all Series for all purposes.
(iii) Dividends. Dividends and distributions on Shares of a
particular Series may be paid with such frequency as the Trustees may
determine, which may be daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as the
Trustees may determine, to the holders of Shares of that Series, from such
of the income and capital gains, accrued or realized, and from the assets
belonging to that Series, as the Trustees may determine, after providing
for actual and accrued liabilities belonging to that Series. All
dividends and distributions on Shares of a particular Series shall be
distributed pro rata to the holders of that Series in proportion to the
number of Shares of that Series held by such holders at the date and time
of record established for the payment of such dividends or distributions,
except that in connection with any dividend or distribution program or
procedure the Trustees may determine that no dividend or distribution
shall be payable on Shares as to which the Shareholder's purchase order
and/or payment have not been received by the time or times established by
the Trustees under such program or procedure. Such dividends and
distributions may be made in cash or Shares or a combination thereof as
determined by the Trustees or pursuant to any program that the Trustees
may have in effect at the time for the election by each Shareholder of the
mode of the making of such dividend or distribution to that Shareholder.
Any such dividend or distribution paid in Shares will be paid at the net
asset value thereof as determined in accordance with paragraph 13 or
Article SEVENTH.
(iv) Liquidation. In the event of the liquidation or dissolution
of the Trust, the Shareholders of each Series that has been established
and designated shall be entitled to receive, as a Series, when and as
declared by the Trustees, the excess of the assets belonging to that
Series over the liabilities belonging to that Series. The assets so
distributable to the Shareholders of any particular Series shall be
distributed among such Shareholders in proportion to the number of Shares
of that Series held by them and recorded on the books of the Trust.
(v) Transfer. All Shares of each particular Series shall be
transferable, but transfers of Shares of a particular Series will be
recorded on the Share transfer records of the Trust applicable to that
Series only at such times as Shareholders shall have that right to require
the Trust to redeem Shares of that Series and at such other times as may
be permitted by the Trustees.
(vi) Equality. All Shares of each particular Series shall represent
an equal proportionate interest in the assets belonging to that Series
(subject to the liabilities belonging to that Series), and each Share or
any particular Series shall be equal to each other Share of that Series;
but the provisions of this sentence shall not restrict any distinctions
permissible under subsection (iii) of part (B) of this Article FOURTH that
may exist with respect to dividends and distributions on Shares of the
same Series. The Trustees may from time to time divide or combine the
Shares of any particular Series into a greater or lesser number of Shares
of that Series without thereby changing the proportionate beneficial
interest in the assets belonging to that Series or in any way affecting
the rights of Shares of any other Series.
(vii) Fractions. Any fractional Share of any Series, if any such
fractional Share is outstanding, shall carry proportionately all the
rights and obligations of a whole Share of that Series, including those
rights and obligations with respect to voting, receipt of dividends and
distributions, redemption of Shares, and liquidation of the Trust.
(viii) Conversion Rights. Subject to compliance with the
requirements of the 1940 Act, the Trustees shall have the authority to
provide that holders of Shares of any Series shall have the right to
convert said Shares into Shares of one or more other Series of Shares in
accordance with such requirements and procedures as may be established by
the Trustees.
(x) Ownership of Shares. The ownership of Shares shall be recorded
on the books of the Trust or of a transfer or similar agent for the Trust,
which books shall be maintained separately for the Shares of each Series
that has been established and designated. No certification certifying the
ownership of Shares need be issued except as the Trustees may otherwise
determine from time to time. The Trustees may make such rules as they
consider appropriate for the issuance of Share certificates, the use of
facsimile signatures, the transfer of Shares and similar matters. The
record books of the Trust as kept by the Trust or any transfer or similar
agent, as the case may be, shall be conclusive as to who are the
Shareholders and as to the number of Shares of each Series held from time
to time by each Shareholder.
(xiv) Investments in the Trust. The Trustees may accept investments
in the Trust from such persons and on such terms and for such
consideration, not inconsistent with the provisions of the 1940 Act, as
they from time to time authorize. The Trustees may authorize any
distributor, principal underwriter, custodian, transfer agent or other
person to accept orders for the purchase of Shares that conform to such
authorized terms and to reject any purchase orders for Shares whether or
not conforming to such authorized terms.
FIFTH: The following provisions are hereby adopted with respect to
voting Shares of the Trust and certain other rights:
1. The Shareholders shall have the power to vote (i) for the
election of Trustees when that issue is submitted to them, (ii) with
respect to the amendment of this Declaration of Trust except where
the Trustees are given authority to amend the Declaration of Trust
without shareholder approval, (iii) to the same extent as the
shareholders of a Massachusetts business corporation, as to whether
or not a court action, proceeding or claim should be brought or
maintained derivatively or as a class action on behalf of the Trust
or the Shareholders, and (iv) with respect to those matters relating
to the Trust as may be required by the 1940 Act or required by law,
by this Declaration of Trust, or the By-Laws of the Trust or any
registration statement of the Trust with the Commission or any State,
or as the Trustees may consider desirable.
2. The Trust shall not be required to hold annual meetings of
shareholders unless required by the 1940 Act, the provisions of this
Declaration of Trust, or any other applicable law.
3. At all meetings of Shareholders, each Shareholder shall be
entitled to one vote on each matter submitted to a vote of the
Shareholders of the affected Series for each Share standing in his
name on the books of the Trust on the date, fixed in accordance with
the By-Laws, for determination of Shareholders of the affected Series
entitled to vote at such meeting (except, if the Board so determines,
for Shares redeemed prior to the meeting), and each such Series shall
vote as an individual class ("Individual Class Voting"); a Series
shall be deemed to be affected when a vote of the holders of that
Series on a matter is required by the 1940 Act; provided, however,
that as to any matter with respect to which a vote of Shareholders
is required by the 1940 Act or by any applicable law that must be
complied with, such requirements as to a vote by Shareholders shall
apply in lieu of Individual Class Voting as described above. Any
fractional Share shall carry proportionately all the rights of a
whole Share, including the right to vote and the right to receive
dividends. The presence in person or by proxy of the holders of one-
third of the Shares, or of the Shares of any Series, outstanding and
entitled to vote thereat shall constitute a quorum at any meeting of
the Shareholders or of that Series, respectively; provided however,
that if any action to be taken by the Shareholders or by a Series at
a meeting requires an affirmative vote of a majority, or more than
a majority, of the shares outstanding and entitled to vote, then in
such event the presence in person or by proxy of the holders of a
majority of the shares outstanding and entitled to vote at such a
meeting shall constitute a quorum for all purposes. If at any
meeting of the Shareholders there shall be less than a quorum
present, the Shareholders or the Trustees present at such meeting
may, without further notice, adjourn the same from time to time until
a quorum shall attend, but no business shall be transacted at any
such adjourned meeting except such as might have been lawfully
transacted had the meeting not been adjourned.
4. Each Shareholder, upon request to the Trust in proper form
determined by the Trust, shall be entitled to require the Trust to
redeem all or part of the Shares standing in the name of such
Shareholder. The method of computing the net asset value, the time
at which such net asset value shall be computed and the time within
which the Trust shall make payment therefor, shall be determined as
hereinafter provided in Article SEVENTH of this Declaration of Trust.
Notwithstanding the foregoing, the Trustees, when permitted or
required to do so by the 1940 Act, may suspend the right of the
Shareholders to require the Trust to redeem Shares.
5. No Shareholder shall, as such holder, have any right to purchase
or subscribe for any security of the Trust which it may issue or
sell, other than such right, if any, as the Trustees, in their
discretion, may determine.
6. All persons who shall acquire Shares shall acquire the same
subject to the provisions of the Declaration of Trust.
SIXTH: (A) The persons who shall act as initial Trustees until the
first meeting or until their successors are duly chosen and qualify are
the initial trustees executing this Declaration of Trust or any
counterpart thereof. However, the By-Laws of the Trust may fix the number
of Trustees at a number greater or lesser than the number of initial
Trustees and may authorize the Trustees to increase or decrease the number
of Trustees, to fill any vacancies on the Board which may occur for any
reason, including any vacancies created by any such increase in the number
of Trustees, to set and alter the terms of office of the Trustees and to
lengthen or lessen their own terms of office or make their terms of office
of indefinite duration, all subject to the 1940 Act. Unless otherwise
provided by the By-Laws of the Trust, the Trustees need not be
Shareholders.
(B) A Trustee at any time may be removed either with or without
cause by resolution duly adopted by the affirmative vote of the holders
of two-thirds of the outstanding Shares, present in person or by proxy at
any meeting of Shareholders called for such purpose; such a meeting shall
be called by the Trustees when requested in writing to do so by the record
holders of not less than ten per centum of the outstanding Shares. A
Trustee may also be removed by the Board of Trustees as provided in the
By-Laws of the Trust.
(C) The Trustees shall make available a list of names and addresses
of all Shareholders as recorded on the books of the Trust, upon receipt
of the request in writing signed by not less than ten Shareholders, who
have been such for at least six months, holding shares of the Trust valued
at not less than $25,000 at current offering price (as defined in the
Trust's Prospectus and/or Statement of Additional Information) or holding
not less than 1% in amount of the entire amount of Shares issued and
outstanding; such request must state that such Shareholders wish to
communicate with other shareholders with a view to obtaining signatures
to a request for a meeting to take action pursuant to part (B) of this
Article SIXTH and accompanied by a form of communication to the
Shareholders. The Trustees may, in their discretion, satisfy their
obligation under this part (C) by either making available the Shareholder
list to such Shareholders at the principal offices of the Trust, or at the
offices of the Trust's transfer agent, during regular business hours, or
by mailing a copy of such communication and form of request, at the
expense of such requesting Shareholders, to all other Shareholders.
(D) If and when the Trust has outstanding two or more series of
Shares pursuant to Article FOURTH of this Declaration of Trust, each
series shall be considered as if it were a separate common-law Trust
covered by Section 16(c) of the 1940 Act and parts (B) and (C) of this
Article SIXTH. However, the Trust may at any time or from time to time
apply to the Commission for one or more exemptions from all or part of
said Section 16(c) and, if an exemptive order or orders are issued by the
Commission, such order or orders shall be deemed part of Section 16(c) for
the purposes of parts (B) and (C) of this Article SIXTH.
SEVENTH: The following provisions are hereby adopted for the purpose
of defining, limiting and regulating the powers of the Trust, the Trustees
and the Shareholders.
1. As soon as any Trustee is duly elected by the Shareholders or
the Trustees and shall have accepted this trust, the Trust estate
shall vest in the new Trustee or Trustees, together with the
continuing Trustees, without any further act or conveyance, and he
shall be deemed a Trustee hereunder.
2. The death, declination, resignation, retirement, removal, or
incapacity of the Trustees, or any one of them shall not operate to
annul the Trust or to revoke any existing agency created pursuant to
the terms of this Declaration of Trust.
3. The assets of the Trust shall be held separate and apart from
any assets now or hereafter held in any capacity other than as
Trustee hereunder by the Trustees or any successor Trustees. All of
the assets of the Trust shall at all times be considered as vested
in the Trustees. No Shareholder shall have, as such holder of
beneficial interest in the Trust, any authority, power or right
whatsoever to transact business for or on behalf of the Trust, or on
behalf of the Trustees, in connection with the property or assets of
the Trust, or any part thereof.
4. The Trustees in all instances shall act as principals, and are
and shall be free from the control of the Shareholders. The Trustees
shall have full power and authority to do any and all acts and to
make and execute, and to authorize the officers and agents of the
Trust to make and execute, any and all contracts and instruments that
they may consider necessary or appropriate in connection with the
management of the Trust. The Trustees shall not in any way be bound
or limited by present or future laws or customs in regard to trust
investments, but shall have full authority and power to make any and
all investments which they, in their uncontrolled discretion, shall
deem proper to accomplish the purpose of this Trust. Subject to any
applicable limitation in this Declaration of Trust or by the By-Laws
of the Trust, the Trustees shall have power and authority:
(a) to adopt By-Laws not inconsistent with this Declaration of
Trust providing for the conduct of the business of the Trust and to
amend and repeal them to the extent that they do not reserve that
right to the Shareholders;
(b) to elect and remove such officers and appoint and terminate
such officers as they consider appropriate with or without cause;
(c) to employ a bank or trust company as custodian of any
assets of the Trust subject to any conditions set forth in this
Declaration of Trust or in the By-Laws;
(d) to retain a transfer agent and shareholder servicing agent,
or both;
(e) to provide for the distribution of Shares either through
a principal underwriter or the Trust itself or both;
(f) to set record dates in the manner provided for in the By-
Laws of the Trust;
(g) to delegate such authority as they consider desirable to
any officers of the Trust and to any agent, custodian or underwriter;
(h) to vote or give assent, or exercise any rights of ownership,
with respect to stock or other securities or property held in Trust
hereunder; and to execute and deliver powers of attorney to such
person or persons as the Trustees shall deem proper, granting to such
person or persons such power and discretion with relation to
securities or property as the Trustees shall deem proper;
(i) to exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities held in
trust hereunder;
(j) to hold any security or property in a form not indicating
any trust, whether in bearer, unregistered or other negotiable form,
or either in its own name or in the name of a custodian or a nominee
or nominees, subject in either case to proper safeguards according
to the usual practice of Massachusetts business trusts or investment
companies;
(k) to consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or
concern, any security of which is held in the Trust; to consent to
any contract, lease, mortgage, purchase, or sale of property by such
corporation or concern, and to pay calls or subscriptions with
respect to any security held in the Trust;
(l) to compromise, arbitrate, or otherwise adjust claims in
favor of or against the Trust or any matter in controversy including,
but not limited to, claims for taxes;
(m) to make, in the manner provided in the By-Laws,
distributions of income and of capital gains to Shareholders;
(n) to borrow money to the extent and in the manner permitted
by the 1940 Act and any fundamental policy of this Trust as to
borrowing;
(o) to enter into investment advisory or management contracts,
subject to the 1940 Act, with any one or more corporations,
partnerships, trusts, associations or other persons; and
(p) to change the name of the Trust as they consider
appropriate without prior shareholder approval.
5. No one dealing with the Trustees shall be under any obligation
to make any inquiry concerning the authority of the Trustees, or to
see to the application of any payments made or property transferred
to the Trustees or upon their order.
6. (a) The Trustees shall have no power to bind any Shareholder
personally or to call upon any Shareholder for the payment of any sum
of money or assessment whatsoever other than such as the Shareholder
may at any time personally agree to pay by way of subscription to any
Shares or otherwise. There is hereby expressly disclaimed
shareholder liability for the acts and obligations of the Trust.
Every note, bond, contract or other undertaking issued by or on
behalf of the Trust or the Trustees relating to the Trust shall
include a recitation limiting the obligation represented thereby to
the Trust and its assets (but the omission of such recitation shall
not operate to bind any Shareholder).
(b) Whenever this Declaration of Trust calls for or permits any
action to be taken by the Trustees hereunder, such action shall mean
that taken by the Board of Trustees by vote of the majority of a
quorum of Trustees as set forth from time to time in the By-Laws of
the Trust or as required by the 1940 Act.
(c) The Trustees shall possess and exercise any and all such
additional powers as are reasonably implied from the powers herein
contained such as may be necessary or convenient in the conduct of
any business or enterprise of the Trust, to do and perform anything
necessary, suitable, or proper for the accomplishment of any of the
purposes, or the attainment of any one or more of the objects, herein
enumerated, or which shall at any time appear conducive to or
expedient for the protection or benefit of the Trust, and to do and
perform all other acts and things necessary or incidental to the
purposes herein before set forth, or that may be deemed necessary by
the Trustees.
(d) The Trustees shall have the power, to the extent not
inconsistent without the 1940 Act, to determine conclusively whether
any moneys, securities, or other properties of the Trust property
are, for the purposes of this Trust, to be considered as capital or
income and in what manner any expenses or disbursements are to be
borne as between capital and income whether or not in the absence of
this provision such moneys, securities, or other properties would be
regarded as capital or income and whether or not in the absence of
this provision such expenses or disbursements would ordinarily be
charged to capital or to income.
7. The By-Laws of the Trust may divide the Trustees into classes
and prescribe the tenure of office of the several classes, but no
class shall be elected for a period shorter than that from the time
of the election following the division into classes until the next
meeting and thereafter for a period shorter than the interval between
meetings or for a period longer than five years, and the term of
office of at least one class shall expire each year.
8. The Shareholders shall have the right to inspect the records,
documents, accounts and books of the Trust, subject to reasonable
regulations of the Trustees, not contrary to Massachusetts law, as
to whether and to what extent, and at what times and places, and
under what conditions and regulations, such right shall be exercised.
9. Any officer elected or appointed by the Trustees or by any
committee of the Trustees may be removed at any time, with or without
cause, by vote of the Trustees.
10. If the By-Laws so provide, the Trustees shall have power to hold
their meetings, to have an office or offices and, subject to the
provisions of the laws of Massachusetts, to keep the books of the
Trust outside of said Commonwealth at such places as may from time
to time be designated by them. Action may be taken by the Trustees
without a meeting upon unanimous written consent or by telephone or
similar method of communication.
11. Securities held by the Trust shall be voted in person or by
proxy by the President or a Vice-President, or such officer of
officers of the Trust as the Trustees shall designate for the
purpose, or by a proxy or proxies thereunto duly authorized by the
Trustee, except as otherwise ordered by vote of the holders of a
majority of the Shares outstanding and entitled to vote in respect
thereto.
12. (a) Subject to the provisions of the 1940 Act, any Trustee,
officer or employee, individually, or any partnership of which any
Trustee, officer or employee may be a member, or any corporation or
association of which any Trustee, officer or employee may be an
officer, director, trustee, employee or stockholder, may be a party
to, or may be pecuniarily or otherwise interested in, any contract
or transaction of the Trust, and in the absence of fraud no contract
or other transaction shall be hereby affected or invalidated;
provided that in case a Trustee, or a partnership, corporation or
association of which a Trustee is a member, officer, director,
trustee, employee or stockholder is so interested, such fact shall
be disclosed or shall have been known to the Trustees or a majority
thereof; and any Trustee who is so interested, or who is also a
director, officer, trustee, employee or stockholder of such other
corporation or a member of such partnership which is so interested,
may be counted in determining the existence of a quorum at any
meeting of the Trustees which shall authorize any such contract or
transaction, and may vote thereat to authorize any such contract or
transaction, with like force and effect as if he were not such
director, officer, trustee, employee or stockholder of such other
trust or corporation or association or a member of a partnership so
interested.
(b) Specifically, but without limitation of the foregoing, the
Trust may enter into a management or investment advisory contract or
underwriting contract and other contracts with, and may otherwise do
business with any manager or investment adviser for the Trust and/or
principal underwriter of the Shares of the Trust or any subsidiary
or affiliate of any such manager or investment adviser and/or
principal underwriter and may permit any such firm or corporation to
enter into any contracts or other arrangements with any other firm
or corporation relating to the Trust notwithstanding that the
Trustees of the Trust may be composed in part of partners, directors,
officers or employees of any such firm or corporation, and officers
of the Trust may have been or may be or become partners, directors,
officers or employees of any such firm or corporation, and in the
absence of fraud the Trust and any such firm or corporation may deal
freely with each other, and no such contract or transaction between
the Trust and any such firm or corporation shall be invalidated or
in any way affected thereby, nor shall any Trustee or officer of the
Trust be liable to the Trust or to any Shareholder or creditor
thereof or to any other person for any loss incurred by it or him
solely because of the existence of any such contract or transaction;
provided that nothing herein shall protect any director or officer
of the Trust against any liability to the trust or to its security
holders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office.
(c)(1) As used in this paragraph the following terms shall have
the meanings set forth below:
(i) the term "indemnitee" shall mean any present or former
Trustee, officer or employee of the Trust, any present or former
Trustee or officer of another trust or corporation whose securities
are or were owned by the Trust or of which the Trust is or was a
creditor and who served or serves in such capacity at the request of
the Trust, and the heirs, executors, administrators, successors and
assigns of any of the foregoing; however, whenever conduct by an
indemnitee is referred to, the conduct shall be that of the original
indemnitee rather than that of the heir, executor, administrator,
successor or assignee;
(ii) the term "covered proceeding" shall mean any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, to which an indemnitee is
or was a party or is threatened to be made a party by reason of the
fact or facts under which he or it is an indemnitee as defined above;
(iii) the term "disabling conduct" shall mean willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of the office in question;
(iv) the term "covered expenses" shall mean expenses
(including attorney's fees), judgments, fines and amounts paid in
settlement actually and reasonable incurred by an indemnitee in
connection with a covered proceeding; and
(v) the term "adjudication of liability" shall mean, as to
any covered proceeding and as to any indemnitee, an adverse
determination as to the indemnitee whether by judgement, order,
settlement, conviction or upon a plea of nolo contendere or its
equivalent.
(d) The Trust shall not indemnify any indemnitee for any
covered expenses in any covered proceeding if there has been an
adjudication of liability against such indemnitee expressly based on
a finding of disabling conduct.
(e) Except as set forth in (d) above, the Trust shall indemnify
any indemnitee for covered expenses in any covered proceeding,
whether or not there is an adjudication of liability as to such
indemnitee, if a determination has been made that the indemnitee was
not liable by reason of disabling conduct by (i) a final decision on
the merits by the court or other body before which the covered
proceeding was brought; or (ii) in the absence of such decision, a
reasonable determination, based on a review of the facts, by either
(a) the vote of a majority of quorum of Trustees who are neither
"interested persons", as defined in the 1940 Act nor parties to the
covered proceedings, or (b) an independent legal counsel in a
written opinion; provided that such Trustees or counsel, in reaching
such determination, may but need not presume the absence of disabling
conduct on the part of the indemnitee by reason of the manner in
which the covered proceeding was terminated.
(f) Covered expenses incurred by an indemnitee in connection
with a covered proceeding shall be advanced by the Trust to an
indemnitee prior to the final disposition of a covered proceeding
upon the request of the indemnitee for such advance and the
undertaking by or on behalf of the indemnitee to repay the advance
unless it is ultimately determined that the indemnitee is entitled
to indemnification hereunder, but only if one or more of the
following is the case: (i) the indemnitee shall provide a security
for such undertaking; (ii) the Trust shall be insured against losses
arising out of any lawful advances; or (iii) there shall have been
a determination, based on a review of the readily available facts (as
opposed to a full trial-type inquiry) that there is a reason to
believe that the indemnitee ultimately will be found entitled to
indemnification by either independent legal counsel in a written
opinion of by the vote of a majority of a quorum or trustees who are
neither "interested persons" as defined in the 1940 Act nor parties
to the covered proceeding.
(g) Nothing herein shall be deemed to affect the right of the
Trust and/or any indemnitee to acquire and pay for any insurance
covering any or all indemnitees to the extent permitted by the 1940
Act or to affect any other indemnification rights to which any
indemnitee may be entitled to the extent permitted by the 1940 Act.
13. For purposes of the computation of net asset value, as in this
Declaration of Trust referred to, the following rules shall apply:
(a) The net asset value per Share of any Series, as of the time
of valuation on any day, shall be the quotient obtained by the
dividing the value, as at such time, of the net assets of that Series
(i.e., the value of the assets of that Series less its liabilities
exclusive of its surplus) by the total number of Shares of that
Series outstanding at such time. The assets and liabilities of any
Series shall be determined in accordance with generally accepted
accounting principles; provided, however, that in determining the
liabilities of any Series there shall be included such reserves for
taxes or contingent liabilities as may be authorized or approved by
the Trustees, and provided further that in connection with the
accrual of any fee or refund payable to or by an investment adviser
of the Trust for such Series, the amount of which accrual is not
definitely determinable as of any time at which the net asset value
of each Share of the Series is being determined due to the contingent
nature of such fee or refund, the Trustees are authorized to
establish from time to time formulae for such accrual, on the basis
of the contingencies in question to the date of such determination,
or on such other basis as the Trustees may establish.
(1) Shares of a Series to be issued shall be deemed to be
outstanding as of the time of the determination of the net asset
value per Share applicable to such issuance and the net price
thereof shall be deemed to be an asset of that Series;
(2) Shares of a Series to be redeemed by the Trust shall be
deemed to be outstanding until the time of the determination of
the net asset value applicable to such redemption and thereupon
and until paid the redemption price thereof shall be deemed to
be a liability of that Series; and
(3) Shares of a Series voluntarily purchased or contracted to
be purchased by the Trust pursuant to the provisions of
paragraph 3 of Article FIFTH shall be deemed to be outstanding
until whichever is the later of (i) the time of the making of
such purchase or contract of purchase, and (ii) the time of
which the purchase price is determined, and thereupon and until
paid, the purchase price thereof shall be deemed to be a
liability of that Series.
(b) The Trustees are empowered, in their absolute discretion,
to establish bases or times, or both, for determining the net asset
value per Share of any Series in accordance with the 1940 Act and to
authorize the voluntary purchase by any Series, either directly or
through an agent, of Shares of any Series upon such terms and
conditions and for such consideration as the Trustees shall deem
advisable in accordance with any such provision, rule or regulation.
14. Payment of the net asset value per Share of any Series properly
surrendered to it for redemption shall be made by the Trust within
seven days, or as specified in any applicable law or regulation,
after tender of such stock or request for redemption to the Trust for
such purpose plus any period of time during which the right of the
holders of the shares of that Series to require the trust to redeem
such shares has been suspended. Any such payment may be made in
portfolio securities of that Series and/or in cash, as the Trustees
shall deem advisable, and no Shareholder shall have a right, other
than as determined by the Trustees, to have his Shares redeemed in
kind.
15. The Trust shall have the right, at any time and without prior
notice to the Shareholder, to redeem Shares held in any account
registered in the name of such Shareholder for its current net asset
value, if and to the extent that such redemption is necessary to
reimburse either the Trust or the distributor (i.e., principal
underwriter) of the Shares for any loss either has sustained by
reason of the failure of such Shareholder to make timely and good
payment for Shares purchased or subscribed for by such Shareholder,
regardless of whether such Shareholder was a Shareholder at the time
of such purchase or subscription, subject to and upon such terms and
conditions as the Trustees may from time to time prescribe.
EIGHTH:
1. In case any Shareholder or former Shareholder shall be held to
be personally liable solely by reason of his being or having been a
Shareholder and not because of his acts or omissions or for some
other reason, the Shareholder or former Shareholder (or his heirs,
executors, administrators or other legal representatives or in the
case of a corporation or other entity, its corporate or other general
successor) shall be entitled out of the Trust estate to be held
harmless from and indemnified against all loss and expense arising
from such liability. The Trust shall, upon request by the
Shareholder, assume the defense of any claim made against any
Shareholder for any act or obligation of the Trust and satisfy any
judgment thereon.
2. It is hereby expressly declared that a trust and not a
partnership is created hereby. No individual Trustee hereunder shall
have any power to bind the Trust, the Trust's officers or any
Shareholder. All persons extending credit to, doing business with,
contracting with or having or asserting any claim against the Trust
or the Trustees shall look only to the assets of the Trust for
payment under any such credit, transaction, contract or claim; and
neither the Shareholders nor the Trustees, not any of their agents,
whether past, present or future, shall be personally liable therefor;
notice of such disclaimer shall be given in each agreement,
obligation or instrument entered into or executed by the Trust or the
Trustees. Nothing in this Declaration of Trust shall protect a
Trustee against any liability to which such Trustee would otherwise
be subject by reasons of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee hereunder.
3. The exercise by the Trustees of their powers and discretion
hereunder in good faith and with reasonable care under the
circumstances then prevailing, shall be binding upon everyone
interested. Subject to the provisions of paragraph 2 of this Article
EIGHTH, the Trustees shall not be liable for errors of judgement or
mistakes of fact or law. The Trustees may take advice of counsel or
other experts with respect to the meaning and operations of this
Declaration of Trust, contracts, obligations, transactions or any
other business the Trust may enter into, and subject to the
provisions of paragraph 2 of this Article EIGHTH, shall be under no
liability for any act or omission in accordance with such advice or
for failing to follow such advice. The Trustees shall not be
required to give any bond as such, not any surety if a bond is
required.
4. This Trust shall continue without limitation of time but subject
to the provisions of sub-sections (a), (b), (c) and (d) of this
paragraph 4.
(a) The Trustees, with the favorable vote of the holders of
more than a majority, as defined in the 1940 Act, of the outstanding
Shares of any one or more Series entitled to vote, may sell and
convey the assets of that Series (which sale may be subject to the
retention of assets for the payment of liabilities and expenses) to
another issuer for a consideration which may be or include securities
of such issuer. Upon making provision for the payment of
liabilities, by assumption by such issuer or otherwise, the Trustees
shall distribute the remaining proceeds ratably among the holders of
the outstanding Shares of the Series the assets of which have been
so transferred.
(b) The Trustees, with the favorable vote of the holders of
more than a majority, as defined in the 1940 Act, of the outstanding
Shares of any one or more Series entitled to vote, may at any time
sell and convert into money all the assets of that Series. Upon
making provisions for the payment of all outstanding obligations,
taxes and other liabilities, accrued or contingent, of that Series,
the Trustees shall distribute the remaining assets of that Series
ratably among the holders of the outstanding Shares of the Series.
(c) The Trustees, with the favorable vote of the holders of
more than a majority, as defined in the 1940 Act, of the outstanding
Shares of any one or more Series entitled to vote, may otherwise
alter, convert or transfer the assets of that Series.
(d) Upon completion of the distribution of the remaining
proceeds or the remaining assets as provided in sub-sections (a) and
(b), and in subsection (c) where applicable, the Series the assets
of which have been so transferred shall terminate, and if all the
assets of the trust have been so transferred, the Trust shall
terminate and the Trustees shall be discharged of any and all further
liabilities and duties hereunder and the right, title and interest
of all parties shall be cancelled and discharged.
5. The original or a copy of this instrument and of each
declaration of trust supplemental hereto shall be kept at the office
of the Trust where it may be inspected by any Shareholder. A copy
of this instrument and of each supplemental declaration of trust
shall be filed with the Massachusetts Secretary of State, as well as
any other governmental office where such filing may from time to time
be required. Anyone dealing with the Trust may rely on a certificate
by an officer of the Trust as to whether or not any such supplemental
declarations of trust have been made and as to any matters in
connection with the Trust hereunder, and with the same effect as if
it were the original, may rely on a copy certified by an officer of
the trust to be a copy of this instrument or of any such supplemental
declaration of trust. In this instrument, and all expressions like
"herein", "hereof" and "hereunder" shall be deemed to refer to this
instrument as amended or affected by any such supplemental
declaration of trust. This instrument may be executed in any number
of counterparts, each of which shall be deemed as original.
6. The Trust set forth in this instrument is created under and is
to be governed by and construed and administered according to the
laws of the Commonwealth of Massachusetts. The Trust shall be of the
type commonly called a Massachusetts business trust, and without
limiting the provisions hereof, the Trust may exercise all powers
which are ordinarily exercised by such a trust.
7. The Board of Trustees in empowered to cause the redemption of
the Shares held in any account if the aggregate net asset value of
such Shares (taken at cost or value, as determined by the Board) has
been reduced to $500 or less upon such notice to the shareholder in
question, with such permission to increase the investment in question
and upon such other terms and conditions as may be fixed by the Board
of Trustees in accordance with the 1940 Act.
8. In the event that any person advances the organizational
expenses of the Trust, such advances shall become an obligation of
the Trust subject to such terms and conditions as may be fixed by,
and on a date fixed by, or determined with criteria fixed by the
Board of Trustees, to be amortized over a period or periods to be
fixed by the Board.
9. Whenever any action is taken under this Declaration of Trust
under any authorization to take action which is permitted by the 1940
Act or any other applicable law, such action shall be deemed to have
been properly taken if such action is in accordance with the
construction of the 1940 Act or such other applicable law then in
effect as expressed in "no action" letters of the staff of the
Commission or any release, rule, regulation or order under the 1940
Act or any decision of a court of competent jurisdiction,
notwithstanding that any of the foregoing shall later be found to be
invalid or otherwise reversed or modified by any of the foregoing.
10. Any action which may be taken by the Board of Trustees under
this Declaration of Trust or its By-Laws may be taken by the
description thereof in the then effective prospectus and statement
of additional information relating to the Shares under the Securities
Act of 1933 or in any proxy statement of the Trust rather than by
formal resolution of the Board.
11. Whenever under this Declaration of Trust, the Board of Trustees
is permitted or required to place a value on assets of the Trust,
such action may be delegated by the Board, and/or determined in
accordance with a formula determined by the Board, to the extent
permitted by the 1940 Act.
12. If authorized by vote of the Trustees and the favorable vote of
the holders of more than a majority, as defined in the 1940 Act, of
the outstanding Shares entitled to vote, or by any larger vote which
may be required by applicable law in any particular case, the
Trustees shall amend or otherwise supplement this instrument, by
making a Declaration of Trust supplemental hereto, which thereafter
shall form a part hereof; any such Supplemental Declaration of Trust
may be executed by and on behalf of the Trust and the Trustees by an
officer or officers of the Trust.
IN WITNESS WHEREOF, the undersigned have executed this instrument as of
this 7th day of October, 1985.
/s/ Leo Cherne /s/ Benjamin Lipstein
- - ---------------------- ----------------------
Leo Cherne Benjamin Lipstein
50 East 79 Street 333 East 57 Street
New York, NY 10021 New York, New York 10022
/s/ Edmund T. Delaney /s/ Pauline Trigere
- - ---------------------- -----------------------
Edmund T. Delaney Pauline Trigere
5 Gorham Road 525 Park Avenue
Chester, CT 06412 New York, New York 10081
/s/ Leon Levy /s/ Kenneth A. Randall
- - ---------------------- ------------------------
Leon Levy Kenneth A. Randall
983 Park Avenue 13 Valley Road
New York, New York 10028 New Canaan, CT 06840
/s/ Sidney M. Robbins
- - -----------------------
Sidney M. Robbins
50 Overlook Road
Ossining, NY 10562
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
BY-LAWS
(amended as of 8/6/87)
ARTICLE I
SHAREHOLDERS
Section 1. Place_of_Meeting. All meetings of the
Shareholders (which terms as used herein shall, together with all
other terms defined in the Declaration of Trust, have the same
meaning as in the Declaration of Trust) shall be held at the
principal office of the Trust or at such other place as may from
time to time be designated by the Board of Trustees and stated in
the notice of meting.
Section 2. Shareholder_Meetings. Meetings of the
Shareholders for any purpose or purposes may be called by the
Chairman of the Board of Trustees, if any, or by the President or
by the Board of Trustees and shall be called by the Secretary upon
receipt of the request in writing signed by Shareholders holding
not less than one third in amount of the entire number of Shares
issued and outstanding and entitled to vote thereat. Such request
shall state the purpose or purposes of the proposed meeting. In
addition, meetings of the Shareholders shall be called by the Board
of Trustees upon receipt of the request in writing signed by
Shareholders that have, for at least six months prior to making
such requests, held not less than ten percent in amount of the
entire number of Shares issued and outstanding and entitled to vote
thereat, stating that the purpose of the proposed meeting is the
removal of a Trustee.
Section 3. Notice_of_Meetings_of_Shareholders. Not less than
ten days' and not more than 120 days' written or printed notice of
every meeting of Shareholders, stating the time and place thereof
(and the general nature of the business proposed to be transacted
at any special or extraordinary meeting), shall be given to each
Shareholder entitled to vote thereat by leaving the same with him
or at his residence or usual place of business or by mailing it,
postage prepaid and addressed to him at his address as it appears
upon the books of the Trust.
No notice of the time, place or purpose of any meeting of
Shareholders need by given to any Shareholder who attends in person
or by proxy or to any Shareholder who, in writing executed and
filed with the records of the meeting, either before or after the
holding thereof, waives such notice.
Section 4. Record_Dates. The Board of Trustees may fix, in
advance, a date, not exceeding 120 days and not less than ten days
preceding the date of any meeting of Shareholders, and not
exceeding 120 days preceding any dividend payment date or any date
and entitled to receive such dividends or rights for the allotment
of rights, as a record date for the determination of the
Shareholders entitled to receive such dividend or rights, as the
case may be; and only Shareholders of record on such date and
entitled to receive such dividends or rights shall be entitled to
notice of and to vote at such meeting or to receive such dividends
or rights, as the case may be.
Section 5. Access_to_Shareholder_List. The Board of
Trustees shall make available a list of the names and addresses of
all shareholders as recorded on the books of the Trust, upon
receipt of the request in writing signed by not less than ten
Shareholders holding Shares of the Trust valued at $25,000 or more
at current offering price (as defined in the Trust's Prospectus),
or holding not less than one percent in amount of the entire number
of shares of the Trust issued and outstanding; such request must
state
that such Shareholders wish to communicate with other Shareholders
with a view to obtaining signatures to a request for a meeting
pursuant to Section 2 of Article II of these By-Laws and
accompanied by a form of communication to the Shareholders. The
Board of Trustees may, in its discretion, satisfy its obligation
under this Section 5 by either making available the Shareholder
List to such Shareholders at the principal offices of the Trust, or
at the offices of the Trust's transfer agents, during regular
business hours, or by mailing a copy of such Shareholders' proposed
communication and form of request, at their expense, to all other
Shareholders.
Section 6. Quorum,_Adjournment_of_Meetings. The presence in
person or by proxy of the holders of record of more than 50% of the
Shares of the stock of the Trust issued and outstanding and
entitled to vote thereat, shall constitute a quorum at all meetings
of the Shareholders. If at any meeting of the Shareholders there
shall be less than a quorum present, the Shareholders present at
such meeting may, without further notice, adjourn the same from
time to time until a quorum shall attend, but no business shall be
transacted at any such adjourned meeting except such as might have
been lawfully transacted had the meeting not been adjourned.
Section 7. Voting_and_Inspectors. At all meetings of
Shareholders, every Shareholder of record entitled to vote thereat
shall be entitled to vote at such meeting either in person or by
proxy appointed by instrument in writing subscribed by such
Shareholder or his duly authorized attorney-in-fact.
All elections of Trustees shall be had by a plurality of the
votes cast and all questions shall be decided by a majority of the
votes cast, in each case at a duly constituted meeting, except as
otherwise provided in the Declaration of Trust or in these By-Laws
or by specific statutory provision superseding the restrictions and
limitations contained in the Declaration of Trust or in these By-
Laws.
At any election of Trustees, the Board of Trustees prior
thereto may, or, if they have not so acted, the Chairman of the
meeting may, and upon the request of the holders of ten per cent
(10%) of the Shares entitled to vote at such election shall,
appoint two inspectors of election who shall first subscribe an
oath or affirmation to execute faithfully the duties of inspectors
at such election with strick impartiality and according to the best
of their ability, and shall after the election make a certificate
of the result of the vote taken. No candidate for the office of
Truste shall be appointed such Inspector.
The Chairman of the meeting may cause a vote by ballot to be
taken upon any election of matter, and such vote shall be taken
upon the request of the holders of ten percent (10%) of the Shares
entitled to vote on such election or matter.
Section 8. Conduct_of_Shareholders'_Meetings. The meetings
of the Shareholders shall be presided over by the Chairman of the
Board of Trustees, if any, or if he shall not be present, by the
President, or if he shall not be present, by a Vice-President, or
if neither the Chairman of the Board of Trustees, the President nor
any Vice-President is present, by a chairman to be elected at the
meeting. The Secretary of the Trust, if present, shall act as
Secretary of such meetings, or if he is not present, an Assistant
Secretary shall so act, if neither the Secretary nor an Assistant
Secretary is present, than the meeting meeting shall elect is
secretary.
Section 9. Concerning_Validity_of_Proxies,_Ballots,_Etc. At
every meeting of the Shareholders, all proxies shall be received
and taken in charge of and all ballots shall be received and
canvassed by the secretary of the meeting, who shall decide all
questions touching the qualification of voters, the validity of the
proxies, and the acceptance or rejection of votes, unless
inspectors of election shall have been appointed as provided in
Section 7, in which event such inspectors of election shall decide
all such questions.
ARTICLE II
BOARD OF TRUSTEES
Section 1. Number_and_Tenure_of_Office. The business and
property of the Trust shall be conducted and managed by a Board of
Trustees consisting of the number of initial Trustees, which number
may be increased or decreased as provided in Section 2 of this
Article. Each Trustee shall, except as otherwise provided herein,
hold office until the meeting of Shareholders of the Trust next
succeeding his election or until his successor is duly elected and
qualifies. Trustees need not be Shareholders.
Section 2.
Increase_or_Decrease_in_Number_of_Trustees;_Removal. The Board of
Trustees, by the vote of a majority of the entire Board, may
increase the number of Trustees to a number not exceeding fifteen,
and may elect Trustees to fill the vacancies occurring for any
reason, including vacancies created by any such increase in the
number of Trustees until the next annual meeting or until their
successors are duly elected and qualify; the Board of Trustees, by
the vote of a majority of the entire Board, may likewise decrease
the number of Trustees to a number not less than three but the
tenure of office of any Trustee shall not be affected by any such
decrease. In the event that after the proxy material has been
printed for a meeting of Shareholders at which Trustees are to be
elected and any one or more nominees named in such proxy material
dies or become incapacitated, the authorized number of Trustees
shall be automatically reduced by the number of such nominees,
unless the Board of Trustees prior to the meeting shall otherwise
determine. A Trustee at any time may be removed either with or
without cause by resolution duly adopted by the affirmative votes
of the holders of the majority of the outstanding Shares of the
Trust, present in person or by proxy at any meeting of Shareholders
at which such vote may be taken, provided that a quorum is present.
Any Trustee at any time may be removed for cause by resolution duly
adopted at any meeting of the Board of Trustees provided that
notice thereof is contained in the notice of such meeting and that
such resolution is adopted by the vote of at least two thirds of
the Trustees whose removal is not proposed. As used herein, "for
cause" shall mean any cause which under Massachusetts law would
permit the removal of a Trustee of a business trust.
Section 3. Place_of_Meeting. The Trustees may hold their
meetings, have one or more offices, and keep the books of the Trust
outside Massachusetts, at any office or offices of the Trust or at
any other place as they may from time to time by resolution
determine, or, in the case of meetings, as they may from time to
time by resolution determine or as shall be specified or fixed in
the respective notices or waivers of notice thereof.
Section 4. Regular_Meetings. Regular meetings of the Board
of Trustees shall be held at such time and on such notice, if any,
as the Trustees may from time to time determine. One such regular
meeting during each fiscal year of the Trust shall be designated an
annual meeting of the Board of Trustees.
Section 5. Special_Meetings. Special meetings of the Board
of Trustees may be held from time to time upon call of the Chairman
of the Board of Trustees, if any, the
President or two or more of the Trustees, by oral, telegraphic or
written notice duly served on or sent or mailed to each Trustee not
less than one day before such meeting. No notice need be given to
any Trustee who attends in person or to any Trustee who in writing
executed and filed with the records of the meeting either before or
after the holding thereof, waives such notice. Such notice or
waiver of notice need not state the purpose or purposes of such
meeting.
Section 6. Quorum. One-third of the Trustees then in office
shall constitute a quorum for the transaction of business, provided
that a quorum shall in no case be less than two Trustees. If at
any of the Board there shall be less than a quorum present (in
person or by open telephone line, to the extent permitted by the
Investment Company Act of 1940 (the "1940 Act")), a majority of
those present may adjourn the meeting from time to time until a
quorum shall have been obtained. The act of the majority of the
Trustees present at any meeting at which there is a quorum shall be
the act of the Board, except as may be otherwise specifically
provided by statute, by the Declaration of Trust or by these By-
Laws.
Section 7. Executive_Committee. The Board of Trustees may,
by the affirmative vote of a majority of the entire Board, elect
from the Trustees an Executive Committee to consist of such number
of Trustees as the Board may from time to time determine. The Board
of Trustees by such affirmative vote shall have power at any time
to change the members of such Committee and may fill vacancies in
the Committee by election from the Trustees. When the Board of
Trustees is not in session, the Executive Committee shall have and
may exercise any or all of the powers of the Board of Trustees in
the management of the business and affairs of the Trust (including
the power to authorize the seal of the Trust to be affixed to all
papers which may require it) except as provided by law and except
the power to increase or decrease the size of, or fill vacancies on
the Board. The Executive Committee, may fix its own rules of
procedure, and may meet, when and as provided by such rules or by
resolution of the Board of Trustees, but in every case the presence
of a majority shall be necessary to constitute a quorum. In the
absence of any member of the Executive Committee, the members
thereof present at any meeting, whether or not they constitute a
quorum, may appoint a member of the Board of Trustees to act in the
place of such absent member.
Section 8. Other_Committees. The Board of Trustees, by the
affirmative vote of a majority of the entire Board, may appoint
other committees which shall in each case consist of such number of
members (not less than two) and shall have and may exercise such
powers as the Board may determine in the resolution appointing
them. A majority of all members of any such committee may
determine its action, and fix the time and place of its meetings,
unless the Board of Trustees shall otherwise provide. The Board of
Trustees shall have power at any time to change the members and
powers of any such committee, to fill vacancies, and to discharge
any such committee.
Section 9.
Informal_Action_by__and_Telephone_Meetings_of_Trustees_and
Committees. Any action required or permitted to be taken at any
meeting of the Board of Trustees or any committee thereof may be
taken without a meeting, if a written consent to such action is
signed by all members of the Board, or of such committee, as the
case may be. Trustees or members of a committee of the Board of
Trustees may participate in a meeting by means of a conference
telephone or similar communications equipment; such participation
shall, except as otherwise required by the 1940 Act, have the same
effect as presence in person.
Section 10. Compensation_of_Trustees. Trustees shall be
entitled to receive such compensation from the Trust for their
services as may from time to time be voted by the Board of
Trustees.
Section 11. Dividends. Dividends or distributions payable on
the Shares of any Series of the Trust may, but need not be,
declared by specific resolution of the Board as to each dividend or
distribution; in lieu of such specific resolutions, the Board may,
by general resolution, determine the method of computation thereof,
the method of determining the Shareholders of the Series to which
they are payable and the methods of determining whether and to
which Shareholders they are to be paid in cash or in additional
Shares.
ARTICLE III
OFFICERS
Section 1. Executive_Officers. The executive officers of the
Trust may include a Chairman of the Board of Trustees, and shall
include a President, one or more Vice-Presidents (the number
thereof to be determined by the Board of Trustees), a Secretary and
a Treasurer. The Chairman of the Board of Trustees, if any, and
the President shall be selected from among the Trustees. The Board
of Trustees may also in its discretion appoint Assistant
Secretaries, Assistant Treasurers, and other officers, agents and
employees, who shall have authority and perform such duties as the
Board or the Executive Committee may determine. The Board of
Trustees may fill any vacancy which may occur in any office. Any
two offices, except those of President and Vice-President, may be
held by the same person, but no officer shall execute, acknowledge
or verify any instrument in more than one capacity, if such
instrument is required by law or these By-Laws to be executed,
acknowledged or verified by two or more officers.
Section 2. Term_of_Office. The term of office of all
officers shall be until their respective successors are chosen and
qualify; however, any officer may be removed from office at any
time with or without cause by the vote of a majority of the entire
Board of Trustees.
Section 3. Powers_and_Duties. The officers of the Trust
shall have such powers and duties as generally pertain to their
respective offices, as well as such powers and duties as may from
time to time be conferred by the Board of Trustees or the Executive
Committee.
ARTICLE IV
SHARES
Section 1. Shares_Certificates. Each Shareholder of any
Series of the Trust may be issued a certificate or certificates for
his Shares of that Series, in such form as the Board of Trustees
may from time to time prescribe, but only if and to the extent and
on the conditions described by the Board.
Section 2. Transfer_of_Shares. Shares of any Series shall be
transferable on the books of the Trust by the holder thereof in
person or by his duly authorized attorney or
legal representative, upon surrender and cancellation of
certificates, if any, for the same number of Shares of that Series,
duly endorsed or accompanied by proper instruments of assignment
and transfer, with such proof of the authenticity of the signature
as the Trust or its agent may reasonably require; in the case of
shares not represented by certificates, the same or similar
requirements may be imposed by the Board of Trustees.
Section 3. Share_Ledgers. The share ledgers of the Trust,
containing the name and address of the Shareholders of each Series
of the Trust and the number of shares of that Series, held by them
respectively, shall be kept at the principal offices of the Trust
or, if the Trust employs a transfer agent, at the offices of the
transfer agent of the Trust.
Section 4. Lost,_Stolen_or_Destroyed_Certificates. The Board
of Trustees may determine the conditions upon which a new
certificate may be issued in place of a certificate which is
alleged to have been lost, stolen or destroyed; and may, in their
discretion, require the owner of such certificate or his legal
representative to give bond, with sufficient surety to the Trust
and the transfer agent, if any, to indemnify it and such transfer
agent against any and all loss or claims which may arise by reason
of the issue of a new certificate in the place of the one so lost,
stolen or destroyed.
ARTICLE V
SEAL
The Board of Trustees shall provide a suitable seal of the
Trust, in such form and bearing such inscriptions as it may
determine.
ARTICLE VI
FISCAL YEAR
The fiscal year of the Trust shall be fixed by the Board of
Trustees.
ARTICLE VII
AMENDMENT OF BY-LAWS
The By-Laws of the Trust may be altered, amended, added to or
repealed by the Shareholders or by majority vote of the entire
Board of Trustees, but any such alteration, amendment, addition or
repeal of the By-Laws by action of the Board of Trustees may be
altered or repealed by the Shareholders.
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of the 20th day of June, 1991, by and between
OPPENHEIMER GOLD & SPECIAL MINERALS FUND (hereinafter referred to as the
"Fund"), and OPPENHEIMER MANAGEMENT CORPORATION (hereinafter referred to
as "OMC").
WHEREAS, the Fund is an open-end, diversified management
investment company registered as such with the Securities and Exchange
Commission (the "Commission") pursuant to the Investment Company Act of
1940 (the "Investment Company Act"), and OMC is a registered investment
adviser;
NOW, THEREFORE, in consideration of the mutual promises and
covenants hereinafter set forth, it is agreed by and between the parties,
as follows:
1. General Provision.
The Fund hereby employs OMC and OMC hereby undertakes to act as
the investment adviser of the Fund and to perform for the Fund such other
duties and functions as are hereinafter set forth. OMC shall, in all
matters, give to the Fund and its Board of Trustees the benefit of its
best judgment, effort, advice and recommendations and shall, at all times
conform to, and use its best efforts to enable the Fund to conform to (i)
the provisions of the Investment Company Act and any rules or regulations
thereunder; (ii) any other applicable provisions of state or federal law;
(iii) the provisions of the Declaration of Trust and By-Laws of the Fund
as amended from time to time; (iv) policies and determinations of the
Board of Trustees of the Fund; (v) the fundamental policies and investment
restrictions of the Fund as reflected in its registration statement under
the Investment Company Act or as such policies may, from time to time, be
amended by the Fund's shareholders; and (vi) the Prospectus and Statement
of Additional Information of the Fund in effect from time to time. The
appropriate officers and employees of OMC shall be available upon
reasonable notice for consultation with any of the Trustees and officers
of the Fund with respect to any matters dealing with the business and
affairs of the Fund including the valuation of any of the Fund's portfolio
securities which are either not registered for public sale or not being
traded on any securities market.
2. Investment Management.
(a) OMC shall, subject to the direction and control by the
Fund's Board of Trustees, (i) regularly provide investment advice and
recommendations to the Fund with respect to its investment policies and
the purchase and sale of securities; (ii) supervise continuously the
investment program of the Fund and the composition of its portfolio and
determine what securities shall be purchased or sold by the Fund; and
(iii) arrange, subject to the provisions of paragraph "8" hereof, for the
purchase of securities and other investments for the Fund and the sale of
securities and other investments held in the portfolio of the Fund.
(b) Provided that the Fund shall not be required to pay any
compensation other than as provided by the terms of this Agreement and
subject to the provisions of paragraph "8" hereof, OMC may obtain
investment information, research or assistance from any other person,
firm or corporation to supplement, update or otherwise improve its
investment management services.
(c) So long as it shall have acted with due care and in good
faith, OMC shall not be liable for any loss sustained by reason of any
investment, the adoption of any investment policy, or the purchase, sale
or retention of any security irrespective of whether the determinations
of OMC relative thereto shall have been based, wholly or partly, upon the
investigation or research of any other individual, firm or corporation
believed by it to be reliable. Nothing herein contained shall, however,
be construed to protect OMC against any liability to the Fund or its
security holders by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement.
3. Acting as Adviser for Others.
Nothing in this Agreement shall prevent OMC or any officer
thereof from acting as investment adviser for any other person, firm or
corporation and shall not in any way limit or restrict OMC or any of its
directors, officers, stockholders or employees from buying, selling or
trading any securities for its or their own account or for the account of
others for whom it or they may be acting, provided that such activities
will not adversely affect or otherwise impair the performance by OMC of
its duties and obligations under this Agreement.
4. Other Duties of OMC.
OMC shall, at its own expense, provide and supervise the
activities of all administrative and clerical personnel as shall be
required to provide effective administration for the Fund, including the
compilation and maintenance of such records with respect to its operations
as may reasonably be required; the preparation and filing of such reports
with respect thereto as shall be required by the Commission; composition
of periodic reports with respect to its operations for the shareholders
of the Fund; composition of proxy materials for meetings of the Fund's
shareholders and the composition of such registration statements as may
be required by federal securities laws for continuous public sale of
shares of the Fund. OMC shall, as its own cost and expense, also provide
the Fund with adequate office space, facilities and equipment.
5. Allocation of Expenses.
All other costs and expenses not expressly assumed by OMC under
this Agreement, or to be paid by the General Distributor of the shares of
the Fund, shall be paid by the Fund, including, but not limited to (i)
interest and taxes; (ii) brokerage commissions; (iii) insurance premiums
for fidelity and other coverage requisite to its operations; (iv)
compensation and expenses of its trustees other than those associated or
affiliated with OMC; (v) legal and audit expenses; (vi) custodian and
transfer agent fees and expenses; (vii) expenses incident to the
redemption of its shares; (viii) expenses incident to the issuance of its
shares against payment therefor by or on behalf of the subscribers
thereto; (ix) fees and expenses, other then as hereinabove provided,
incident to the registration under federal securities laws of shares of
the Fund for public sale; (x) expenses of printing and mailing reports,
notices and proxy materials to shareholders of the Fund; (xi) except as
noted above, all other expenses incidental to holding meetings of the
Fund's shareholders; and (xii) such extraordinary non-recurring expenses
as may arise, including litigation, affecting the Fund and the legal
obligation which the Fund may have to indemnify its officers and directors
with respect thereto. Any officers or employees of OMC or any entity
controlling, controlled by or under common control with OMC, who may also
serve as officers, trustees or employees of the Fund shall not receive any
compensation by the Fund for their services.
6. Compensation of OMC.
The Fund agrees to pay OMC and OMC agrees to accept as full
compensation for the performance of all functions and duties on its part
to be performed pursuant to the provisions hereof, a fee computed on the
aggregate net assets of the Fund as of the close of each business day and
payable monthly at the following annual rates:
July 1, 1991 thru June 30, 1992
.90% of the first $200 million of aggregate net assets;
.80% on next $200 million;
.69% on next $200 million;
.66% on next $200 million; and
.60% of aggregate net assets over $800 million.
July 1, 1992 thru June 30, 1993
.85% of the first $200 million of aggregate net assets;
.75% on next $200 million;
.69% on next $200 million;
.66% on next $200 million; and
.60% of aggregate net assets over $800 million.
July 1, 1993 thru June 30, 1994
.80% of the first $200 million of aggregate net assets;
.75% on next $200 million;
.69% on next $200 million;
.66% on next $200 million; and
.60% of aggregate net assets over $800 million.
July 1, 1994 and thereafter
.75% of the first $200 million of aggregate net assets;
.72% on next $200 million;
.69% on next $200 million;
.66% on next $200 million; and
.60% of aggregate net assets over $800 million.
7. Use of Name "Oppenheimer."
OMC hereby grants to the Fund a royalty-free, non-exclusive
license to use the name "Oppenheimer" in the name of the Fund for the
duration of this Agreement and any extensions or renewals thereof. Such
license may, upon termination of this Agreement, be terminated by OMC, in
which event the Fund shall promptly take whatever action may be necessary
to change its name and discontinue any further use of the name
"Oppenheimer" in the name of the Fund or otherwise. The name
"Oppenheimer" may be used or licensed by OMC in connection with any of its
activities or licensed by OMC to any other party.
8. Portfolio Transactions and Brokerage.
(a) OMC is authorized, in arranging the purchase and sale of the
Fund's portfolio securities, to employ or deal with such members of
securities exchanges, brokers or dealers, including "affiliated" broker-
dealers (as that term is defined in the Investment Company Act),
(hereinafter "broker-dealers"), as may, in its best judgment, implement
the policy of the Fund to obtain, at reasonable expense, the "best
execution" (prompt and reliable execution at the most favorable security
price obtainable) of the Fund's portfolio transactions as well as to
obtain, consistent with the provisions of subparagraph "(c)" of this
paragraph "8," the benefit of such investment information or research as
will be of significant assistance to the performance by OMC of its
investment management functions.
(b) OMC shall select broker-dealers to effect the Fund's
portfolio transactions on the basis of its estimate of their ability to
obtain best execution of particular and related portfolio transactions.
The abilities of a broker-dealer to obtain best execution of particular
portfolio transaction(s) will be judged by OMC on the basis of all
relevant factors and considerations including, insofar as feasible, the
execution capabilities required by the transaction or transactions; the
ability and willingness of the broker-dealer to
facilitate the Fund's portfolio transactions by participating therein for
its own account; the importance to the Fund of speed, efficiency or
confidentiality; the broker-dealer's apparent familiarity with sources
from or to whom particular securities might be purchased or sold; as well
as any other matters relevant to the selection of a broker-dealer for
particular and related transactions of the Fund.
(c) OMC shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to broker-dealers,
other than affiliated broker-dealers, qualified to obtain best execution
of such transactions who provide brokerage and/or research services (as
such services are defined in Section 29(e)(3) of the Securities Exchange
Act of 1934) for the Fund and/or other accounts for which OMC exercises
"investment discretion" (as that term is defined in Section 3(a)(35) of
the Securities Exchange Act of 1934) and to cause the Fund to pay such
broker-dealers a commission for effecting a portfolio transaction for the
Fund that is in excess of the amount of commission another broker-dealer
adequately qualified to effect such transaction would have charged for
effecting that transaction, if OMC determines, in good faith, that such
commission is reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer, viewed in terms of
either that particular transaction or OMC's overall responsibilities with
respect to the accounts as to which it exercises investment discretion.
In reaching such determination, OMC will not be required to place or
attempt to place a specific dollar value on the brokerage and/or research
services provided or being provided by such broker-dealer. In
demonstrating that such determinations were made in good faith, OMC shall
be prepared to show that all commissions were allocated for purposes
contemplated by this Agreement and that the total commissions paid by the
Fund over a representative period selected by the Fund's trustees were
reasonable in relation to the benefits to the Fund.
(d) OMC shall have no duty or obligation to seek advance
competitive bidding for the most favorable commission rate applicable to
any particular transactions or to select any broker-dealer on the basis
of its purported or "posted" commission rate but will, to the best of its
ability, endeavor to be aware of the current level of the charges of
eligible broker-dealers and to minimize the expense incurred by the Fund
for effecting its portfolio transactions to the extent consistent with the
interests and policies of the Fund as established by the determinations
of its Board of Trustees and the provisions of this paragraph "8."
(e) The Fund recognizes that an affiliated broker-dealer (i) may
act as one of the Fund's regular brokers so long as it is lawful for it
so to act; (ii) may be a major recipient of brokerage commissions paid by
the Fund; and (iii) may effect portfolio transactions for the Fund only
if the commissions, fees or other remuneration received or to be received
by it are determined in accordance with procedures contemplated by any
rule, regulation or order adopted under the Investment Company Act for
determining the permissible level of such commissions.
(f) Subject to the foregoing provisions of this paragraph "8,"
OMC may also consider sales of shares of the Fund and other investment
companies managed by OMC or its affiliates as a factor in the selection
of broker-dealers for its portfolio transactions.
9. Duration.
This Agreement will take effect on the date set forth above and
will continue in effect until December 31, 1991, and thereafter, from year
to year, so long as such continuance shall be approved at least annually
by the Fund's Board of Trustees, including the vote of the majority of the
trustees of the Fund who are not parties to this Agreement or "interested
persons" (as defined in the Investment Company Act) of any such party,
cast in person at a meeting called for the purpose of voting on such
approval, or by the holders of a "majority" (as defined in the Investment
Company Act) of the outstanding voting securities of the Fund and by such
a vote of the Fund's Board of Trustees.
10. Termination.
This Agreement may be terminated (i) by OMC at any time without
penalty upon giving the Fund sixty days' written notice (which notice may
be waived by the Fund); or (ii) by the Fund at any time without penalty
upon sixty days' written notice to OMC (which notice may be waived by OMC)
provided that such termination by the Fund shall be directed or approved
by the vote of a majority of all of the trustees of the Fund then in
office or by the vote of the holders of a majority of the outstanding,
voting securities of the Fund.
11. Assignment or Amendment.
This Agreement may not be amended or the rights of OMC hereunder
sold, transferred, pledged or otherwise in any manner encumbered without
the affirmative vote or written consent of the holders of the majority of
the outstanding voting securities of the Fund; this Agreement shall
automatically and immediately terminate in the event of its "assignment,"
as defined as stated below.
12. Shareholder Liability.
OMC understands and agrees that the obligations of the Fund under
this Agreement are not binding upon any Trustee or shareholder of the Fund
personally, but bind only the Fund and the Fund's property; OMC represents
that it has notice of the provisions of the Declaration of Trust of the
Fund disclaiming shareholder liability for acts or obligations of the
Fund.
13. Definitions.
The terms and provisions of this Agreement shall be interpreted
and defined in a manner consistent with the provisions and definitions of
the Investment Company Act.
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
By: /s/ Robert G. Galli, Secretary
OPPENHEIMER MANAGEMENT CORPORATION
By: /s/ Robert G. Zack, Senior Vice
President
AGREEMENT AND PLAN OF
REORGANIZATION AND LIQUIDATION
This AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION is made as
of this 10th day of October, 1985, by and between Oppenheimer Gold &
Special Minerals Fund, Inc. (the "Fund"), a Maryland corporation, and
Oppenheimer Gold & Special Minerals Fund (the "Trust"), a Massachusetts
business trust.
In consideration of the mutual promises herein contained, the parties
hereto agree as follows:
1. Plan of Reorganization and Liquidation. (a) On or prior to the
Effective Time of the Reorganization (as defined in Section 2 hereof), the
Fund and the Trust shall execute and file articles of transfer with
respect to the transaction contemplated with the Department of Assessments
and Taxation of the State of Maryland. The Fund will convey, transfer and
deliver to the Trust at the closing provided in Section 2 (hereinafter
called the "Closing") all of its then existing assets. In consideration
thereof, the Trust agrees at the Closing (i) to assume and pay, to the
extent that they exist on or after the Effective Time of the
Reorganization, all of the Fund's obligations and liabilities, whether
absolute, accrued, contingent or otherwise, including all fees and
expenses in connection with this Plan of Reorganization and Liquidation,
including without limitation, costs of legal advice, accounting, printing,
mailing, proxy solicitation and transfer taxes, if any, and (ii) to
deliver to the Fund full and fractional shares of beneficial interest of
the series of the Trust entitled "Oppenheimer Gold & Special Minerals
Fund", without par value (the "Trust Shares"), equal in number to the
number of full and fractional shares of Capital Stock of the Fund
outstanding immediately prior to the Effective Time of the Reorganization.
(b) At the Effective Time of the Reorganization, the Fund will
liquidate and distribute pro rata to its shareholders of record at the
Effective Time of the Reorganization the Trust Shares received by the Fund
pursuant to this Section 1. Such liquidation will be accomplished by the
establishment of an open account on the share records of the Trust in the
name of each such shareholder of the Fund and representing the respective
pro rata number of Trust Shares due such shareholder. Fractional Trust
Shares will be carried to the third decimal place. Certificates
representing shares of the Fund shall be deemed to represent an equal
number of Trust Shares. Simultaneously with such crediting of Trust
Shares to the shareholders of record, the shares of the Fund held by such
shareholders shall be cancelled.
2. Closing and Effective Time of the Reorganization. The Closing
shall occur on (a) the next business day after votes approving this
Agreement and the reorganization contemplated hereby shall have been
adopted by the holders of at least a majority of the outstanding shares
of Capital Stock of the Fund entitled to vote or (b) such later date as
the parties may mutually agree (the "Effective Time of the
Reorganization").
3. Termination. The Board of Directors of the Fund may terminate
this Agreement and abandon the reorganization contemplated hereby, at any
time prior thereto, notwithstanding approval thereof by the shareholders
of the Fund, if in the judgment of such Board, proceeding with the
Agreement would be inadvisable.
4. Entire Agreement. This Agreement embodies the entire agreement
between the parties and there are no agreements, understandings,
restrictions or warranties among the parties other than those set forth
herein provided for.
5. Further Assurances. The Fund and the Trust shall take such
further action as may be necessary or desirable and proper to consummate
the transactions contemplated hereby.
6. Governing Law. This Agreement and the transactions contemplated
hereby shall be governed by and construed and enforced in accordance with
the laws of the State of Maryland.
7. Disclaimer of Shareholder Liability. Copies of the Trust's
Declaration of Trust, as amended, are on file with the Secretary of the
Commonwealth of Massachusetts and notice is hereby given that this
Agreement and Plan of Reorganization and Liquidation is executed on behalf
of the Trust by officers of the Trust as officers and not individually and
that the obligations of or arising out of this Agreement are not binding
upon any of the Trustees, officers, shareholders, employees or agents of
the Trust individually but are binding only upon the assets and property
of the Trust.
IN WITNESS WHEREOF, each of the Fund and the Trust has caused this
Agreement and Plan of Reorganization and Liquidation to be executed on its
behalf by its President or a Vice President and its seal to be affixed
hereto and attested by its Secretary or Assistant Secretary, all as of the
day and year first above written.
(Seal) OPPENHEIMER GOLD & SPECIAL
MINERALS FUND, INC.
Attest:
- - ------------------- By ---------------------------
(Name and Title) (Name and Title)
(Seal) OPPENHEIMER GOLD & SPECIAL
MINERALS FUND
Attest:
- - ------------------- By ---------------------------
(Name and Title) (Name and Title)
October 4, 1985
Oppenheimer Gold & Special Minerals Fund
Two Broadway
New York, New York 10004
Dear Sirs:
In connection with the public offering of shares of beneficial
interest of Oppenheimer Gold & Special Minerals Fund (the "Fund"),
we have examined such records and documents and have made such
further investigation and examination as we deemed necessary for
the purpose of this opinion.
It is our opinion that the Fund is a business trust duly
organized and validly existing under the laws of the Commonwealth
of Massachusetts and that an indefinite number of shares of the
Fund covered by Post-Effective Amendment No. 5 (the "Amendment") of
the Fund's Registration Statement on Form N-1A (SEC Reg. No. 2-
82590) when issued and paid for in accordance with the terms of the
offering, as set forth in Prospectus and Statement of Additional
Information forming a part of the Amendment, will be, when such
Amendment shall have become effective, legally issued, fully paid
and non-assessable by the Fund to the extent set forth in such
Amendment.
We hereby consent to the filing of this opinion as an Exhibit
to such Amendment and to the reference to us in such Prospectus and
Statement of Additional Information. We also consent to the filing
of this opinion with the authorities administering the "Blue Sky"
or securities law of any jurisdiction in connection with the
registration or qualification under such law of the Fund's share.
Very truly yours,
/s/ Cole & Deitz
Cole & Deitz
To the Board of Directors
Oppenheimer Gold & Special Minerals Fund
Two Broadway
New York, New York 10004
Gentlemen:
Oppenheimer Management Corporation ("OMC") herewith purchases 10,000
shares of capital stock, par value $.01 per share, of Oppenheimer Gold &
Minerals Fund, Inc. for an aggregate purchase price of $100,000.
In connection with such purchase, OMC represents that such purchase
is made for investment purposes by OMC without any present intention of
redeeming or selling such stock; and furthermore that OMC agrees to
advance the start-up expenses of the Fund and in that regard agrees that
such advances for such start-up expenses shall be reimbursed to OMC by the
Fund on the first day of the first month in which the Fund's assets exceed
$5 million, provided, however, that if any of the above-referenced shares
of the Fund purchased by OMC are redeemed during the five-year period in
which such expenses are amortized by the Fund, OMC will reimburse the Fund
for any unamortized organizational expenses in the same proportion as the
number of shares redeemed bears to the number of initial shares remaining
at the time of such redemption.
Very truly yours,
Oppenheimer Management Corporation
By /s/ Robert G. Galli
Robert G. Galli
Executive Vice President
Dated: May 31, 1983
